FBR sets out government ownership, stock exchange listing and trust criteria for public company status in Tax Year 2027.
ISLAMABAD: The Federal Board of Revenue (FBR) has outlined the criteria for determining whether an entity qualifies as a public company for Tax Year 2027 under the Income Tax Ordinance, 2001.
The definition is contained in the updated Income Tax Ordinance, incorporating amendments up to June 30, 2026, and covers companies based on government ownership, stock exchange listing and certain trust structures.
Government-owned companies
Under the FBR’s definition, a company qualifies as a public company where at least 50% of its shares are held by the Federal Government or a Provincial Government.
The same criterion applies to companies in which not less than 50% of the shares are held by a foreign government, or by a foreign company owned by a foreign government.
The provision therefore covers both domestically and foreign government-controlled companies where the prescribed ownership threshold is met.
Listed companies included
The definition also covers a company whose shares were traded on a registered stock exchange in Pakistan at any time during the relevant tax year.
However, the company must also have remained listed on the stock exchange at the end of that tax year to qualify as a public company under this provision.
This means that temporary trading during the year alone would not be sufficient if the company is no longer listed at the close of the tax year.
Unit trusts and other trusts
The FBR has also included unit trusts whose units are widely available to the public within the definition of a public company.
In addition, the definition covers other trusts falling within the scope of the Trusts Act, 1882.
The inclusion of these trust structures broadens the tax-law definition beyond conventional corporate entities.
Public company status under tax law
The classification of an entity as a public company is important because it can affect the application of various provisions of Pakistan’s income tax legislation.
For Tax Year 2027, companies and relevant trust structures should therefore assess their government ownership, stock exchange listing and trust status against the prescribed criteria to determine whether they fall within the FBR’s definition of a public company.