In Pakistan, receiving a message that “FBR has attached your bank account” can be frightening and financially disruptive. Bank account freezes usually happen when taxpayers ignore statutory notices, fail to pay outstanding liabilities, or do not respond within legal time limits.
Understanding why FBR freezes accounts — and how to legally unfreeze them — can save you from panic, penalties, and further enforcement actions.
This guide explains the entire process in simple, clear, human language.
Why FBR Freezes Bank Accounts
FBR is legally empowered under the Income Tax Ordinance, 2001 (Section 140) to recover unpaid taxes by attaching a taxpayer’s bank account. Below are the most common reasons:
1. Non-Payment of Assessed Tax Liability
If you fail to pay:
Assessment order tax
Demand created under audit
Demand created after withholding reconciliation
Penalties or default surcharges
FBR initiates recovery and attaches bank accounts to secure the amount.
2. Ignoring FBR Notices (Sections 111, 122, 114, 122(5A), 177)
Ignoring notices is the fastest way to end up with a frozen account.
When you don’t respond, your case becomes “best judgment”, and the demand becomes recoverable without further warning.
3. Non-Filing of Income Tax Return
If you haven’t filed your return for one or more years, FBR may:
Estimate your income
Create a tax demand
Initiate recovery through bank attachment
4. Failure to Pay Advance Tax and Withholding Obligations
Companies, AOPs, employers, and filers can face attachment if they fail to:
Deposit withheld tax (153/149/155 etc.)
Deposit sales tax & FED
Deposit advance tax under section 147
5. FBR Audit & Post-Audit Tax Demand
If FBR conducts an audit and issues a tax order for additional liability, the demand becomes recoverable immediately unless you get a stay.
6. Unverified Transactions / Suspicious Banking Activity
Large unexplained deposits may cause:
Notice under Section 111 (unexplained income)
Provisional assessment
Bank account attachment
7. Employer or Business Not Depositing Withheld Tax
If you deducted tax from salaries or payments but didn’t deposit to FBR —
FBR freezes your account instantly.
8. Wrongful Claim of Tax Credits or Refunds
If your tax credits or refunds are disallowed, the revised assessment may create a recoverable demand.
How Does FBR Freeze Bank Accounts? (Legal Process)
FBR issues assessment order or creates a demand.
Taxpayer is given time to pay the due amount.
If no response → FBR issues Recovery Notice (Section 140).
FBR sends attachment notice to the bank.
Bank is legally bound to freeze the account and transfer amount to FBR.
Important:
FBR can freeze accounts without prior personal notice if they believe the taxpayer is trying to avoid recovery.
Can FBR Freeze Accounts Without Informing You?
Yes — under Section 140, FBR can directly instruct the bank without informing the taxpayer first if the officer believes recovery is at risk.
How to Resolve a Frozen Bank Account (Step-by-Step)
Here is exactly what to do when your bank tells you your account is frozen:
1. Immediately Check the Reason in IRIS
Go to:
IRIS → Ledgers → Demand & Recovery → Orders
Identify the exact amount and the order number.
2. File an Application for Stay of Recovery
You can apply for a stay with:
Commissioner Inland Revenue
CIR Appeals
Appellate Tribunal (in complex matters)
A stay can legally prevent recovery for 30–60 days.
3. Submit a Written Response / Explanation
Your reply should include:
Reason for non-payment
Request for time
Proof of filing return or reconciliation
Copy of bank attachment notice
I can prepare a professional reply letter if needed.
4. Pay Partial Amount to Get Account Unfrozen Quickly
Most RTOs unfreeze accounts when you pay 25%–30% of the demand and submit a written undertaking.
5. File Appeal Against the Tax Order
If the tax order is wrong, file appeal under:
Section 127 (Commissioner Appeals)
Section 131 (Appellate Tribunal)
6. Request Bank for Restoration After FBR Approval
Once FBR issues Release of Attachment Order, your bank restores operations within 24–48 hours.
What You Should NEVER Do
❌ Never ignore notices
❌ Never delay responses
❌ Never deposit partial amounts without written acknowledgment
❌ Never deal with unregistered tax agents
How Tanweer Habib & Co. Helps You
As one of the top tax consultants , we assist with:
Unfreezing bank accounts
Filing stay applications
Responding to FBR notices
Appealing wrong tax orders
Clearing tax ledgers
Negotiating payment schedules
Full IRIS filing and compliance
Professional, trusted, legally compliant support.
