Islamabad, September 11, 2025 – Real Estate Investment Trust (REIT) schemes in Pakistan availed a record Rs75.55 billion in income tax exemptions during the tax year 2024, according to the latest report issued by the Federal Board of Revenue (FBR).
The figure reflects a remarkable 221% surge compared to Rs23.51 billion exemptions recorded in the preceding tax year.
The FBR explained that the tax relief is granted under clause 99 of Part I of the Second Schedule of the Income Tax Ordinance, 2001. This provision allows REIT schemes and other collective investment vehicles to claim exemption on income, provided that not less than 90% of their accounting income, after adjusting for realized or unrealized capital gains, is distributed to shareholders, unit holders, or certificate holders within the same tax year.
By design, a REIT is structured to pool capital from multiple investors and channel it into real estate projects, thereby promoting transparency and wider participation in the property sector. The exemptions are intended to encourage the development of Pakistan’s formal real estate market, stimulate investment flows, and offer small investors access to large-scale property ventures that were previously out of reach.
The Income Tax Ordinance, 2001 refers to REIT schemes as defined in the Real Estate Investment Trust Regulations, 2015, which lay down the operational and compliance framework for such entities. Experts believe the growing tax incentives will strengthen Pakistan’s capital markets and deepen investor confidence in the real estate sector.