FBR sets 2.75% withholding tax for ATL sellers and 11.5% for non-ATL taxpayers on property sales

ISLAMABAD: The Federal Board of Revenue (FBR) has updated the withholding tax rates on the sale of immovable property for Tax Year (TY) 2027 under Section 236C of the Income Tax Ordinance, 2001.

The revised rates have been updated in accordance with the Finance Act, 2026 and apply to the gross amount of consideration received on the transfer of immovable property.

ATL taxpayers to pay 2.75%

According to the FBR’s withholding tax card, taxpayers appearing on the Active Taxpayers List (ATL) will be subject to a withholding tax rate of 2.75% on the sale of immovable property.

The 2.75% rate applies across all three consideration slabs specified in the tax card.

For taxpayers who are not on the Active Taxpayers List (non-ATL), the withholding tax rate has been set at 11.50%.

Withholding tax rates on property sales

Gross amount of consideration	ATL rate	Non-ATL rate
Up to Rs50 million	2.75%	11.50%
More than Rs50 million but up to Rs100 million	2.75%	11.50%
More than Rs100 million	2.75%	11.50%

The FBR has prescribed the rates under Division-X of Part-IV of the First Schedule, read with Rule 1 of the Tenth Schedule to the Income Tax Ordinance, 2001.

Tax applies to property transfers

The withholding tax is applicable under Section 236C, which governs the collection of tax on the transfer of immovable property.

The updated tax card provides taxpayers, withholding agents and other stakeholders with a reference for determining their withholding tax obligations on property transactions during Tax Year 2027.

The FBR said the updated rates are intended to facilitate compliance with the income tax law and provide clarity on the applicable withholding obligations for property sellers.