Karachi, November 29, 2024 – The Federal Board of Revenue (FBR) has announced an extension of tax exemptions for overseas Pakistanis involved in property transactions, reaffirming its commitment to facilitating expatriates.
To streamline the process, the FBR has directed tax offices to ensure smooth implementation of these exemptions, particularly for sales and purchases of immovable properties by overseas Pakistanis holding a Pakistan Origin Card (POC) or a National Identity Card for Overseas Pakistanis (NICOP).
According to the FBR, the exemptions are granted under Clause 111AC, introduced through the Finance Act, 2022, which amends the Income Tax Ordinance, 2001. This clause exempts non-resident individuals holding POC or NICOP from higher tax rates under Sections 236C and 236K, even if they are not listed on the Active Taxpayers List (ATL).
To facilitate the process, the FBR is updating its IRIS tax system. Non-resident taxpayers wishing to claim these exemptions will need to upload their POC or NICOP details while creating their withholding tax challan under Sections 236C and 236K. Upon submission, a provisional Payment Slip ID (PSID) will be generated and forwarded to the Chief Commissioner Inland Revenue (CCIR) for review.
The CCIR will then assign the case to the relevant Commissioner Inland Revenue (CIR) for verification of the applicant’s non-resident status. Once the CIR confirms the taxpayer’s eligibility, the exemption will be granted. The taxpayer will be notified via SMS and email, enabling them to proceed with their property transactions without incurring the higher tax rates.
To expedite the process, the FBR has instructed CCIRs to ensure that verification and approval are completed within one business day. This swift resolution aims to enhance efficiency and provide convenience to overseas Pakistanis engaging in real estate transactions.
The FBR’s move reflects its ongoing efforts to strengthen ties with overseas Pakistanis by providing tax relief and simplifying processes, recognizing their vital contributions to the national economy. By ensuring priority handling and transparency, the FBR hopes to foster confidence and encourage further investment in Pakistan’s real estate sector.
