In a significant move, the Federal Board of Revenue (FBR) has announced that overseas Pakistanis can now pay advance tax at filer rates on buying or selling property in Pakistan—even if they are non-filers. This policy applies under specific conditions and is aimed at easing investment for non-resident Pakistanis.
To qualify, individuals must hold either a Pakistan Origin Card (POC) or a National Identity Card for Overseas Pakistanis (NICOP). Additionally, they must have spent fewer than 183 days in Pakistan during the current financial year, making them non-residents under tax law.
According to Sections 236C (for sellers) and 236K (for buyers) of the Income Tax Ordinance, tax rates vary depending on the filer status and property value. For example, buyers of property valued up to Rs50 million are taxed 1.5% if they are filers, while non-filers pay 10.5%. The rate for non-filers increases to 18.5% for properties worth over Rs100 million.
Similarly, for sellers, the tax rate starts at 4.5% for filers, going up to 11.5% for non-filers on lower-value property. For deals above Rs100 million, filers are taxed 5.5%, while late filers pay 9.5%. These high rates have long discouraged overseas investment—especially from those unfamiliar with the complex tax filing system.
To benefit from this relaxation, overseas Pakistanis must declare their POC or NICOP number on the FBR’s official web portal. The system will then generate a Payment Slip ID (PSID) after document verification. Once approved, the person can pay tax at the filer rate, avoiding hefty non-filer charges. This step is seen as part of a broader FBR push to attract remittances and formalize expat real estate investments.