Withholding Tax Card: Non-ATL to pay up to 30pc tax on profit from bank deposits, saving schemes

ISLAMABAD: Federal Board of Revenue (FBR) has issued withholding tax card for tax year 2019/2020 effective from July 01, 2019 under which persons receiving profit from bank deposits or investment in national saving schemes shall pay up to 30 percent, if not on the Active Taxpayers List (ATL).



The FBR said that every person/financial institutions making payment of profit / yield under Section 151 of Income Tax Ordinance, 2001 shall collect withholding tax at the time the yield (profit on debt) from the recipients or actually paid, whichever is earlier.

Following are the withholding tax rates:

Section 151(1)(a):

Yield or profit (profit on debt) on account, deposit or a certificate under the National saving schemes or Post office savings accounts.

Up to Rs500,000: 10 percent of the gross yield/profit paid

Exceeding Rs500,000: 15 percent of the gross yield /profit paid

Persons not appearing in the Active Taxpayers’ List :
The applicable tax rate is to be increased by 100 percent (Rule-1 of Tenth Schedule to the Ordinance), i.e.

Up to Rs500,000: 20 percent of the gross yield/profit paid

Exceeding Rs500,000: 30 percent of the gross yield /profit paid

Section 151(1)(b):

Profit on debt paid by banking company or financial institution on account or deposit maintained.

Up to Rs500,000: 10 percent of the gross yield/profit paid

Exceeding Rs500,000: 15 percent of the gross yield /profit paid

Persons not appearing in the Active Taxpayers’ List :
The applicable tax rate is to be increased by 100 percent (Rule-1 of Tenth Schedule to the Ordinance), i.e.

Up to Rs500,000: 20 percent of the gross yield/profit paid

Exceeding Rs500,000: 30 percent of the gross yield /profit paid

Section 151(1)( c):

Profit on securities, other than those mentioned in s. 151(1)(a), issued by federal / provincial government or a local government

Up to Rs500,000: 10 percent of the gross yield/profit paid

Exceeding Rs500,000: 15 percent of the gross yield /profit paid

Persons not appearing in the Active Taxpayers’ List :
The applicable tax rate is to be increased by 100 percent (Rule-1 of Tenth Schedule to the Ordinance), i.e.

Up to Rs500,000: 20 percent of the gross yield/profit paid

Exceeding Rs500,000: 30 percent of the gross yield /profit paid

Section 151(1)(d):

Profit on bonds, certificates, debentures, securities or instruments of any kind (other than loan agreements between borrowers and banking companies or development financial institutions)

Up to Rs500,000: 10 percent of the gross yield/profit paid

Exceeding Rs500,000: 15 percent of the gross yield /profit paid

Persons not appearing in the Active Taxpayers’ List :
The applicable tax rate is to be increased by 100 percent (Rule-1 of Tenth Schedule to the Ordinance), i.e.

Up to Rs500,000: 20 percent of the gross yield/profit paid

Exceeding Rs500,000: 30 percent of the gross yield /profit paid.

Related Posts:

Withholding Tax Card: Tax rates on salary income

Withholding Tax Card: non-ATL persons to pay 30pc tax on dividend income

Withholding Tax Card: Tax rates on imports of goods for ATL, non-ATL persons

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