Resident individuals meeting specified overseas income or asset limits must submit a Foreign Income and Assets Statement with their annual tax return.
ISLAMABAD: The Federal Board of Revenue (FBR) has prescribed the thresholds requiring resident individuals to declare foreign income and overseas assets while filing income tax returns for Tax Year (TY) 2026 under Section 116A of the Income Tax Ordinance, 2001.
The provision requires eligible resident taxpayers to submit a Foreign Income and Assets Statement alongside their annual income tax return, strengthening transparency and compliance in relation to overseas income and wealth.
Foreign Income and Asset Thresholds
According to Section 116A of the Income Tax Ordinance, every resident individual must furnish a Foreign Income and Assets Statement if they have:
• Foreign income of US$10,000 or more during the tax year; or
• Foreign assets valued at US$100,000 or more.
A taxpayer meeting either threshold is required to disclose the prescribed information relating to foreign income and assets.
Information Required in the Statement
The Foreign Income and Assets Statement must contain comprehensive details of a taxpayer’s overseas financial position, including:
• Total foreign assets and foreign liabilities as at the last day of the tax year.
• Details of foreign assets transferred to another person during the tax year, together with the consideration received.
• Particulars of foreign income earned during the tax year.
• Expenditure incurred in earning foreign income.
• Expenditure wholly and exclusively incurred for deriving that foreign income.
The statement must be submitted in the prescribed form and verified in accordance with FBR requirements.
Commissioner Empowered to Seek Information
Section 116A authorises the Commissioner Inland Revenue to issue a written notice to any resident individual who, in the Commissioner’s opinion, was required to file a Foreign Income and Assets Statement but failed to do so.
Before issuing such a notice, the Commissioner must record reasons in writing and specify the date by which the taxpayer must furnish the required statement.
Compliance Requirement
The FBR has advised resident individuals whose foreign income or overseas assets exceed the prescribed thresholds to ensure that the Foreign Income and Assets Statement is submitted together with their income tax return for TY 2026.
Failure to comply with the reporting requirements may result in proceedings under the relevant provisions of the Income Tax Ordinance, 2001, including notices from the tax authorities.
TY 2026 Return Filing Deadlines
The FBR has notified the following due dates for filing income tax returns for Tax Year 2026:
• September 30, 2026: Salaried individuals, business individuals, Associations of Persons (AOPs), and companies having a special tax year.
• December 31, 2026: Companies following the normal financial year ending June 30.
The tax authority has urged eligible taxpayers to complete all mandatory declarations, including foreign income and overseas asset reporting, before the applicable deadlines to ensure compliance with Pakistan’s tax laws.