If you are living in Pakistan but have been assessed to tax in Azad Jammu & Kashmir (AJK) or Gilgit-Baltistan (GB), it is important to know that the Federal Board of Revenue (FBR) can initiate tax recovery proceedings against you. This ensures tax compliance across regions, even when local authorities cannot recover dues directly.
For tax year 2026, FBR’s powers are outlined under Section 146 of the Income Tax Ordinance, 2001. Here’s an interactive guide to help you understand the process.
🏛 Authority Behind Recovery
Under Section 146(1):
• If a taxpayer assessed in AJK or GB fails to pay tax, and the local tax authorities cannot recover it because:
1. The taxpayer resides in Pakistan, or
2. The taxpayer has no property in AJK or GB,
Then:
• The Deputy Commissioner of AJK or GB can issue a certificate of recovery.
• On receiving this certificate, the FBR Commissioner in Pakistan can recover the tax according to the provisions of the Income Tax Ordinance.
📝 What Must the Recovery Certificate Include?
Under Section 146(2), the certificate must clearly specify:
1. Place of residence of the taxpayer in Pakistan
2. Description and location of movable or immovable property in Pakistan
3. Amount of tax payable by the taxpayer
📌 The certificate allows FBR to target assets and enforce payment within Pakistan.
⚖ How FBR Recovery Works in Practice
Once a certificate is received:
• FBR can use its standard tax recovery powers, including:
o Attachment and sale of movable and immovable property
o Appointment of a receiver
o Recovery from bank accounts or other assets
• Recovery proceeds follow the same procedures as for regular tax assessments
🧠 Why This Matters
Even if you were assessed in AJK or GB:
• Living in Pakistan does not shield you from tax recovery
• FBR ensures inter-regional enforcement of tax laws
• Ignoring recovery notices can result in asset attachment, legal action, or personal liability
✅ How to Stay Compliant
✔ Pay taxes assessed in AJK or GB promptly
✔ Respond to FBR recovery notices immediately
✔ Keep clear records of all assets and income
✔ Consult a tax professional if you are unsure about compliance obligations
📌 Final Takeaway
Section 146 empowers FBR to recover tax from persons residing in Pakistan but assessed in AJK or Gilgit-Baltistan. Compliance is essential to avoid enforcement actions and protect assets in Pakistan.
Pro tip:
Always monitor tax obligations in all jurisdictions where you have residency or property to prevent inter-regional recovery actions.
Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. Tax laws and recovery procedures may change. Consult a qualified tax professional for personalized guidance.