FBR Allows Overseas Pakistanis to Pay Property Tax at Filer Rates

In a major tax relief, the Federal Board of Revenue (FBR) has announced that non-filing or unregistered Overseas Pakistanis will now be treated as “filers” for withholding tax purposes on the purchase and sale of immovable properties in Pakistan.

Non-Filers Can Now Avail Filer Tax Rates

FBR clarified that “the rate of advance income tax on the purchase and sale of immovable properties by overseas Pakistanis would be the ‘filer rate’ even if they are ‘non-filers'”. This step is aimed at encouraging overseas investments in the country’s real estate sector.

Conditions to Qualify for Filer Rates

According to FBR’s FAQs, this tax benefit is subject to certain conditions:

• The individual must possess a POC (Pakistan Origin Card) or NICOP (National Identity Card for Overseas Pakistanis).
• They must be a non-resident, meaning they stay in Pakistan for less than 183 days in a financial year.

Income Tax Depends on Property Value and Tax Status

FBR emphasized that advance income tax under sections 236C and 236K is determined by two factors:

• The fair market value of the property

• The filer status of the individual—whether they filed on time, late, or not at all.

Step-by-Step Process for Tax Reduction

Overseas Pakistanis can access filer rates by following these steps:

1. The Registrar, Authority, or Housing Society managing the transfer of property must visit the FBR web portal and click on the “Overseas Pakistanis” link to generate a PSID (Payment Slip ID).
2. A form will appear where the person enters their POC or NICOP number. The system will automatically fetch personal details, such as name, address, and residency status.
3. The applicant must upload a scanned copy of the POC/NICOP and supporting documents.
4. The PSID is sent to the Commissioner’s IRIS inbox for review.
5. After document verification, the Commissioner will approve the PSID and inform the applicant via email and SMS.
6. “The system shall allow the person to make payment of advance income tax at the ‘filer rate’ despite being a ‘non-filer’”, the FBR confirmed.

This new rule aims to simplify the process and reduce the tax burden for overseas investors in Pakistan’s real estate market.