Income Tax Rule 14 explains how arrival and departure days, holidays, sick leave and transit periods count when determining an individual’s tax residency.

ISLAMABAD: The Federal Board of Revenue (FBR) has clarified the rules for determining the tax residency status of individuals in Pakistan for Tax Year 2027, covering the period from July 1, 2026 to June 30, 2027.

The FBR issued the Income Tax Rules, 2002, updated up to September 15, 2026, explaining Rule 14 concerning resident individuals under Section 82 of the Income Tax Ordinance, 2001.

Under Rule 14, any part of a day spent by an individual in Pakistan counts as a full day of presence. This includes both the day of arrival and the day of departure.

The rules also specify that public holidays, sick leave and other leave days count towards an individual’s physical presence in Pakistan.

Furthermore, days when activities are interrupted because of strikes, lock-outs or delays in receiving supplies are also included in the calculation.

Holidays spent in Pakistan before, during or after an individual’s work or other activities in the country will similarly count as days of presence.

However, the FBR has provided an exception for individuals travelling between two different locations outside Pakistan. A day or part of a day spent in Pakistan solely while transiting between two foreign destinations will not be counted as physical presence.

Rule 14 applies for determining resident individuals under Section 82 and provides guidance on calculating days spent in Pakistan for income tax purposes during Tax Year 2027.