Filing for Tax Year 2026 (1st July 2025 to 30th June 2026) opened on IRIS on 27 July 2026. If you logged in expecting last year’s form with the year changed, you already know it isn’t that.

This is the biggest rewrite of the Pakistani income tax return in years. Not a few extra boxes. A different way of asking the questions, and a different set of assumptions about what the department already knows before you type anything.

I have been through the new screens with client files in front of me. Below is what actually changed, section by section, with the parts that will cost people money if they get them wrong.

01What was notified, and under what authority

The draft was issued through SRO 835(I)/2026 dated 7 May 2026, under section 237 of the Income Tax Ordinance, 2001. Two things about that SRO are worth knowing even if you never read it.

First, the structure. Instead of one return stretched to cover everyone, the SRO inserted four separate electronic return frameworks into the Second Schedule to the Income Tax Rules, 2002, as Parts II-ZE, II-ZF, II-ZG and II-ZH, covering individuals, small and medium enterprises, associations of persons and firms, and companies respectively. Partnerships and firms are now named explicitly rather than being squeezed into the AOP form.

Second, the consultation. Stakeholders were given seven days to object to a document running to roughly 147 pages. Tax bars asked for thirty. Seven days for a form of that size was never a serious consultation, and some of the problems in the final product are a direct result.

The form also came out in May rather than mid-July, which was the signal that FBR wanted the season to start on time and wanted consultants to have the full ninety days. Given how much longer this form takes to complete, that decision was correct.

02The single idea behind the redesign

Every change below follows from one shift: the return has moved from a declaration to a reconciliation.

Previously you told FBR what you earned, and the department checked it later, if ever. Now the form opens by telling you what it already holds against your CNIC or NTN. Withholding deducted from you. Tax you deposited as a withholding agent. Sales tax records. Banking and transaction footprints. Property and vehicle data.

You are no longer filling a blank page. You are agreeing or disagreeing with a file the department has already built.

That is the international direction and, on balance, a good one. But a pre-filled return is only as reliable as the data behind it, and the burden of proving the department wrong now sits with the taxpayer. Keep that in mind for every section that follows.

03Screen one: the profile update gate

Before IRIS will even open the return, a Profile Update Notification appears. You cannot skip it. You must review and save details across:

• Personal details
• Sources of income
• Businesses
• Employer information
• Addresses
• Utility connections
• Bank accounts
• Legal or authorised representatives

Practical point for consultants: this screen is also a section 114A compliance step in disguise. Bank accounts and utility connections declared here will be matched against third-party data later. Do not click through it casually to reach the return.

04Screen two: choosing your income sources

Once the profile is saved, IRIS asks you to build your own form. You select which of these apply:

• Income from salary
• Property rental income
• Income from business
• Capital gain
• Income from agriculture
• Income from foreign sources and assets
• Income from other sources
• No income

Whatever you leave unticked disappears from the form. A salaried filer with nothing else gets a genuinely short return for the first time in years. This is the one change everybody likes.

The risk is the mirror image: tick nothing for a source you actually had, and the tab never appears, and you file an incomplete return without any warning on screen. Decide the ticks deliberately. There is an ADD INCOME SOURCES button at the top right if you realise mid-way that you missed one.

05Residential status: the 183-day question

Immediately below the income selection sits a plain question:

Have you stayed more than 183 days in Pakistan during the tax year?  Yes / No

Answer it honestly and answer it with a calendar in front of you. For overseas Pakistanis and for people who moved during the year, this single toggle decides whether your foreign income and foreign assets are reportable at all. It is the cheapest field on the form to get wrong and one of the most expensive to defend later.

06Summary of Economic Transactions

The lower half of the configuration screen shows a Summary of Economic Transactions for 1st July 2025 to 30th June 2026, drawn from FBR’s own records. Expect to see withholding on bank transactions, vehicle token tax, education fees, utilities, property transactions, and, for registered persons, a sales tax summary covering domestic purchases, imports, sales and exports.

FBR’s own wording on this screen matters:

This is indicative data which keeps on updating as per available information. Therefore, correct reporting of income and tax thereon is primarily your own responsibility.

Read that twice. The department is pre-filling your return and simultaneously disclaiming responsibility for the accuracy of what it pre-filled. If a challan is missing from the summary, that is still your problem. If a challan appears twice, or is tagged to the wrong person, that is also your problem.

07Salary: employer-wise, not lump sum

This is the change that affects the largest number of filers.

Old form: one figure for salary, one figure for tax deducted. New form: for each employer during the year you must give:

• Employer name
• Employer registration number (NTN, or CNIC where the employer is an individual)
• Salary paid by that employer
• Tax deducted by that employer under section 149

Changed jobs in the year? Both employers get listed separately. Held two positions? Both. The system then aggregates every salary declaration filed against a given employer NTN and compares it with what that employer actually deposited.

Why this bites

Section 161 makes the withholding agent personally liable for tax that should have been deducted and was not. Until now, catching a non-deducting employer required an audit. Now ten employees of the same company each name that company in their returns, IRIS adds up the tax that should have been deducted, and the officer gets a ready-made case without lifting a file.

If you are salaried: get your employer’s NTN and a proper deduction certificate now. “I’ll enter it approximately” is not available this year.

08Property income: one row per property

Rental income used to be a single line. It is now a property register. For every property you must supply:

• Full address
• Property type and sub-type
• Cost of acquisition
• Date of acquisition
• Rental income received from that specific property
• Deductible expenses attributable to that specific property
• Details of any sale or disposal during the year
• For a property gifted out: identification of the donee through CNIC, NICOP, NTN or foreign passport particulars

The gift field closes a genuine loophole. Transfers were routinely shown as gifts with no traceable counterparty. That is over.

The unresolved problem: joint ownership

Family properties, inherited shares and jointly held plots are ordinary in Pakistan, and the property register is built around a single owner. Fractional ownership is accommodated properly only at the disposal stage. Until FBR fixes this, declare your share carefully, keep the mutation and inheritance documents ready, and expect to explain the arithmetic.

09Business income: both sides of every transaction

Under Business, the left navigation now opens into separate blocks:

• Manufacturing and trading items
• Other revenues
• Expenses
• Income from social media content (a dedicated line, new this year)

Inadmissible deductions must be added back clause by clause

The form asks you to map disallowances to the specific provision of section 21 rather than dumping them into one figure. In practice the ones that matter are:

• 21(q) — 10% of expenditure on purchases from persons without an NTN, with a carve-out for direct purchases from agricultural growers
• 21(r) — expenditure proportionate to sales made to persons required to be registered under the Sales Tax Act, 1990, who are not registered
• 21(s) — 50% of expenditure attributable to a single-invoice sale of Rs. 200,000 or above where payment was not received through banking or digital channels

These are trigger-based. They should not apply to every business, and if IRIS presents them as universal add-backs, that is a form problem, not a law problem. Compute them on the facts and be ready to justify the figure.

Payments made and payments received both get reported

Along with the withholding tax on each side. A payment where tax was legally due and not deducted now sits in the system as an open invitation to a section 161 notice against the payer.

Social media and platform income has its own line

Content earnings, platform monetisation and online services no longer hide inside “other income”. Useful, but classification is now the live issue. Depending on facts, the same rupee could be business income, export of services, royalty, commission or salary, and each carries a different withholding treatment. A tab in IRIS is not a legal classification. Freelancers and creators should get the head of income right before they get the figure right.

10Income from other sources: institution-wise

Another aggregate line broken into detail. Each of the following now needs the name of the paying institution:

• Profit on debt from bank accounts
• Dividends
• Royalties
• Family pension
• Income from Sukuk and National Savings Certificates

Which means you need every bank profit certificate, every dividend voucher and every NSC statement, not a single total. This is also where filers habitually understate, because profit on debt is deducted at source and people assume it is finished business. It is reportable whether or not it is final tax.

11Agricultural income: parcel by parcel

A single lump-sum agricultural figure is no longer accepted. The form asks for land-parcel-level detail:

• Khasra or field number
• Location of the land
• Income attributable to that parcel

Agricultural income has been the standard cover for undocumented money for decades, and this is a direct attempt to end it. If your client declares agricultural income, the khasra numbers and the land record need to exist and need to match. Provincial agricultural income tax paid should be documented as well.

12Foreign income and foreign assets: now inside the main return

The separate foreign assets statement is gone as a standalone form. Foreign income and foreign assets are integrated into the individual return and the wealth statement. Expect to provide:

• Foreign bank accounts, offshore property and other foreign assets, declared explicitly under Personal Assets and Liabilities
• Foreign Tax Identification Numbers
• IBAN-level bank account detail
• Beneficial ownership and interest details

This aligns Pakistan with the Common Reporting Standard and the automatic exchange framework, and FBR is receiving foreign account data anyway. From the taxpayer’s side, it is a serious expansion of sensitive disclosure with no matching data-protection protocol published so far. That is a fair objection, but it is not a filing strategy. If you hold foreign assets, declare them.

One practical note: foreign assets will not auto-populate. Enter them manually and check them twice.

13Section 7E: read this before you touch that tab

The draft return still carried the section 7E schedule, asking filers to identify the ground of exclusion under sub-section (2) or (3) and upload supporting evidence.

So the provision the schedule operationalises no longer legally exists, and never did. What that means in practice:

• No 7E liability arises for Tax Year 2026 (1st July 2025 to 30th June 2026) or for any earlier year
• Pending 7E notices and proceedings should be met with the FCC short order dated 7 May 2026
• Amounts already collected are, in principle, recoverable, though refund claims run into limitation and the mechanics will depend on the detailed judgment
• If the 7E screen or the 7E certificate requirement is still visible in any FBR system, an administrative screen surviving a constitutional ruling does not revive the levy

Before advising a client to revise earlier returns on this basis, wait for the detailed judgment and read it. The short order is clear on outcome; the reasoning will matter for refunds.

14Wealth Statement (Form 116): the auto-fill is only partial

The reconciliation logic changed, and this is where I expect most of the errors this season.

Partial auto-mapping

Salary and basic incomes carry over into the Reconciliation of Net Assets automatically. Several things do not:

• Freelance and IT / ITeS income
• Final and fixed tax incomes, especially where there are several of them

If you assume the system picked those up, your inflows will be short and you will end up staring at an unreconciled negative figure that has no real-world cause.

The new “+” input system

IRIS no longer shows every possible field by default. Inflow adjustments such as foreign remittances, inheritance and gifts (codes 7034 to 7037, and 7098 onwards) only appear when you click the + beside that category. If you do not click, the field does not exist, and the inflow is missing.

Personal expenses (code 7089)

Instead of a fixed list, click + Expenses and add only the categories you actually incurred. Do not leave this blank. FBR knows you spent something during the year, and a nil expense declaration is a flag on its own.

15Tax payments, refunds and the toolbar

Toolbar buttons at the top right of the return:

• ADD INCOME SOURCES — reopen the form configuration
• IMPORT PREVIOUS RETURN — roll forward static assets and historical detail
• PREPARE PSID — generate the payment slip directly
• CALCULATE — recompute on the spot

IMPORT PREVIOUS RETURN saves real time on wealth statements. Just review what it brings across. Last year’s mistakes import perfectly.

16Tax Year 2025 against Tax Year 2026, at a glance

17Where I expect the trouble to come from

A few honest predictions, based on the first weeks of the season.

Data errors will be treated as taxpayer errors. The pre-filled summary will contain wrong tags, missing challans and duplicates. There is currently no clean, documented route to dispute an imported entry. Keep evidence for everything you override.

Employers are the exposed party this year, not employees. Any business that has been casual about section 149 deductions is about to be added up by its own staff.

Freelancers will under-reconcile. IT and ITeS income does not flow into the wealth statement automatically. That one gap will produce a lot of unnecessary notices.

Joint property owners will file inconsistently. Until fractional ownership is handled properly at the register stage, families holding one property between four heirs will produce four different-looking declarations.

Old IRIS codes do not map cleanly to new fields. Tax Year 2026 began on 1st July 2025, when everyone was still keeping records under the old logic. FBR has not published a migration map. Expect reconstruction work, particularly on property, capital gains, business deductions and final tax items.

None of this makes the redesign wrong. The direction is right, and the form is legally more disciplined than what it replaced. But a return is a legal instrument, not just a software screen, and this one arrived faster than the systems around it.

18What to collect before you open IRIS

For salaried filers

• CNIC
• Salary certificate from every employer, showing gross salary, exempt allowances and section 149 tax deducted
• Employer NTN for each employer
• Bank statements for the full year, 1st July 2025 to 30th June 2026
• Bank profit certificates and withholding certificates
• Vehicle token and registration challans
• Property purchase or sale documents with section 236C and 236K challans

Additionally, for business filers

• Complete sales and purchase records, reconciled with sales tax returns
• Supplier and contractor payment records showing tax deducted on each payment
• Records supporting any section 21 add-backs
• Details of every payment received and the tax withheld on it

Additionally, for property, agriculture and foreign assets

• Address, type, acquisition cost and date for every property
• Lease agreements and property-wise expense records
• Khasra numbers and land records for agricultural land
• Foreign bank account details, IBANs and foreign TINs

19Dates

Do not plan around an extension. FBR held the line for Tax Year 2025 and publicly denied that any extension was coming. Late filing brings penalty exposure under section 182, loss of Active Taxpayer List status, and the higher withholding rates that come with it on banking transactions, property and vehicles. The ATL cost is almost always larger than the penalty itself.

The practical argument for filing early this year is simply that the form takes roughly twice as long as last year’s, and IRIS in the last week of September is not where you want to discover that a property is missing from your register.