Property transactions: Expatriates won’t be charged higher tax rate if they are not on ATL

ISLAMABAD: The Federal Board of Revenue (FBR) has exempted overseas Pakistanis from payment of higher withholding tax rates on sale and purchase of property if they do not appear in the Active Taxpayer List (ATL).

In order to remove concerns of Pakistanis living abroad, the FBR has directed all its officials concerned at LTUs and RTOs that through the Finance Act 2022, the federal government has introduced Clause 111AC under the heading ‘Exemption from Specific Provisions of Second Schedule Part IV of the Income Tax Ordinance 2001’, which exempts non-resident individuals holding Pakistan Origin Card (POC) or National ID Card for Overseas Pakistanis (NICOP) from high rates of taxes u/s 236C and 236K even if they are not appearing in the ATL.

In this context, a change is being incorporated into the FBR’s Iris system for any non-resident taxpayer who wishes to avail the exemption. While creating the CPR, he would be asked to upload his NICOP card, and after doing so, a provisional HID would be generated, which would then be forwarded to the login of concerned CCIR. The CCIR would be granted access to mark the case to the CIR concerned, who would be required to verify the veracity of status of non-resident. Once the CIR is satisfied, he may allow the taxpayer to avail the exemption, and the non-resident/ taxpayer will be intimated through SMS/ email about the approval, after which he can avail the exemption. The CCIRs have been asked to process the verification on priority basis within one business day.