Islamabad, February 17, 2026 β Determining tax residency in Pakistan hinges on the duration of stay, as outlined in Rule 14 of the Income Tax Rules, 2002 (amended up to November 24, 2023). Understanding this rule is crucial for individuals to comply with the Income Tax Ordinance, 2001.
π Key Points of Rule 14 β Resident Individual
1. Applicability
o Rule 14 applies to individuals for the purpose of Section 82 of the Income Tax Ordinance, which determines whether a person qualifies as a resident for tax purposes.
2. Counting Days of Presence in Pakistan
o Whole-day count: Any part of a day spent in Pakistan, including arrival and departure days, counts as a full day.
o Special days counted as present:
ο§ Public holidays
ο§ Days of leave, including sick leave
ο§ Days when activity is interrupted due to strike, lock-out, or delays in supplies
ο§ Holidays before, during, or after any activity in Pakistan
o Days not counted: Time spent in Pakistan solely in transit between two foreign locations does not count.
π‘ Example
Scenario: Ahmed visits Pakistan for business and spends:
β’ 3 days at a conference
β’ 1 public holiday
β’ 2 days in transit
Calculation:
β’ Conference days: 3 β
β’ Public holiday: 1 β
β’ Transit days: 0 β
Total countable days for tax residency: 4 days
π Why It Matters
Being classified as a resident individual in Pakistan affects:
β’ Taxable income reporting
β’ Eligibility for exemptions and reliefs
β’ Compliance with Pakistanβs tax regulations
βοΈ Stay Duration for Tax Residency
While Rule 14 outlines how to count days, Section 82 of the Income Tax Ordinance specifies the threshold for residency, typically 183 days or more in a tax year, making one liable to pay taxes as a resident.