Introduction
Filing an income tax return is not just a legal formality in Pakistan—it’s a critical responsibility that ensures financial transparency, access to tax benefits, and protection from regulatory scrutiny. One of the most significant enforcement mechanisms used by the Federal Board of Revenue (FBR) to compel non-filers into compliance is the issuance of a Section 114B Notice under the Income Tax Ordinance, 2001.
This article serves as a complete guide to understanding Section 114B, what it means when you receive a notice under this section, how to respond to it, the consequences of ignoring it, and how to avoid receiving one in the first place.
What is Section 114B of the Income Tax Ordinance?
Section 114B was introduced to enforce return filing obligations in a more stringent and automated manner. It empowers the FBR to take enforcement actions against individuals and entities that fail to file their tax returns even after being identified as liable to file under the law.
Key Features of Section 114B:
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Grants FBR the authority to issue notices to non-filers
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Allows for disabling of SIM cards, mobile phones, electricity, and gas connections
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Provides a mechanism for appeal or representation before enforcement
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Used as part of broad enforcement efforts to widen the tax base
Who Is Required to File a Return Under Section 114?
According to Section 114(1) of the Income Tax Ordinance, 2001, the following persons must file an income tax return:
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Every company and Association of Persons (AOP)
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Every individual with:
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Taxable income above the threshold (PKR 600,000 for salaried / PKR 400,000 for business)
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Any amount of foreign income
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Owns a vehicle over 1000cc
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Holds property in urban areas
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Has made utility bill payments above the threshold
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Appears on active taxpayer lists for sales tax, property, or other taxes
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Failure to file, despite meeting these conditions, will eventually lead to Section 114B enforcement.
What is a Section 114B Notice?
A Section 114B notice is an FBR-issued intimation or warning to individuals or businesses who are liable to file income tax returns but have failed to do so. It is typically sent through:
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Email (registered with FBR)
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SMS on registered mobile number
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FBR’s IRIS portal notification
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Physical notice via postal service
Legal Wording of Section 114B
“Where the Board is satisfied that a person is required to file a return of income under this Ordinance but has failed to do so, the Board may by notice in writing require such person to file a return within the time specified in the notice.”
Further, it allows the Board to:
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Disable utility services and digital access
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Blacklist a taxpayer’s profile
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Suspend CNIC usage for business transactions
What Triggers a Section 114B Notice?
You may receive a notice under 114B if:
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You appeared on the ATL list last year but failed to file this year’s return
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You made significant banking, property, or utility transactions
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Your CNIC is linked with withholding tax transactions
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You own a car, house, or business license
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You were issued a Section 114(4) or 118(2) notice and didn’t comply
Step-by-Step Guide: What to Do When You Receive a 114B Notice
Step 1: Log into Your IRIS Account
Go to: https://iris.fbr.gov.pk
Check for notices and alerts under:
“Notices / Orders” tab → “114B Notice”
Step 2: Review the Grounds for Notice
Each notice typically contains:
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Tax year in question
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Reason for being classified as liable
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Legal reference and deadline
Step 3: File the Return Immediately
If the reason for notice is valid, file your income tax return promptly for the relevant tax year.
Use:
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IRIS web portal or hire a tax consultant
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Submit Wealth Statement (Form AS) and Income Tax Return (Form IT-1/2/4)
Step 4: Respond to the Notice
Submit your compliance response using the “Explanation” tab under the same notice. Upload your return and wealth statement confirmation.
Step 5: Follow Up
If your utilities were suspended or CNIC blocked, file a restoration request through IRIS or your nearest RTO/LTU office with proof of compliance.
What Happens If You Ignore a 114B Notice?
| Consequence | Description |
|---|---|
| SIM Blocking | FBR can request PTA to block your mobile phone number |
| Utility Suspension | Power and gas utilities can be suspended |
| Asset Verification & Audit | You may be selected for audit under Section 177 or 214C |
| Withholding Tax at Higher Rate | Your name is removed from Active Taxpayer List (ATL) |
| Penalties and Fines | PKR 1,000/day (individuals) or higher for non-compliance |
| Prosecution | Persistent non-filing may result in prosecution under Section 191 |
Can You Challenge a 114B Notice?
Yes. If you believe the notice was sent in error, or if you’re not liable under Section 114, you can:
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File an explanation in IRIS
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Submit supporting evidence (e.g., salary certificate below taxable threshold)
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Contact your Commissioner Inland Revenue through an application
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File a representation under Section 120
Difference Between 114B, 114(4), and 122(9)
| Section | Purpose |
|---|---|
| 114 | General provision for return filing |
| 114(4) | Demand for return from a person not filing voluntarily |
| 114B | Enforcement action after repeated failure |
| 122(9) | Amendment of assessment (audit/revision) |
Practical Example
Case: Freelancer Ignored Multiple Notices
Ali, a freelancer earning over PKR 2 million, failed to file his tax return. He received a Section 114B notice in November. Ignoring the notice led to:
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Blocking of his SIM card
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Suspension of electricity at home office
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Selection for a detailed audit
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Penalties exceeding PKR 60,000
He later had to file 2 years of backlog returns, pay penalties, and wait weeks for service restoration.
Tips to Avoid Receiving 114B Notices
✅ File your income tax return annually
✅ Stay on ATL by filing before the due date
✅ Keep your email and phone updated on IRIS
✅ Monitor high-value transactions (cars, plots, bank transfers)
✅ Hire a tax consultant like Sterling.pk for timely compliance
Frequently Asked Questions (FAQs)
Q1: I don’t have taxable income. Why did I get a notice?
You may have been identified due to ownership of taxable assets or large bank transactions.
Q2: Can I ignore the notice if I file now?
No. You must respond formally through IRIS after filing the return.
Q3: Will I be penalized even if I wasn’t aware of the notice?
Ignorance is not a defense. The law presumes that digital service counts as legal notice.
Q4: Can I get my SIM restored after filing the return?
Yes. Restoration typically takes 3–5 working days after submission of proof.
Q5: Do salaried individuals need to file?
Yes, if your income exceeds the threshold or you own taxable assets.
How Sterling.pk Can Help
At Sterling.pk, we offer:
✅ Quick filing of pending returns and wealth statements
✅ Review and response to 114B notices
✅ SIM and utility restoration support
✅ ATL inclusion and annual filing maintenance
✅ Corporate and individual tax compliance services
Don’t wait for a penalty or disconnection. Let our tax experts handle your notices, filings, and appeals professionally and on time.
Conclusion
Receiving a Section 114B notice is a serious signal that your tax compliance has lapsed. But it’s also an opportunity to bring your affairs into order, avoid harsh penalties, and restore your standing with the FBR. Timely action, proper documentation, and proactive filing are the best ways to stay protected.
If you’ve received a 114B notice or want to avoid it in the future, contact Sterling.pk—Pakistan’s trusted name for individual and corporate tax services.
