The Federal Board of Revenue (FBR) has enforced new rules for overseas Pakistanis buying or selling property in Pakistan. They now need approval from the Commissioner Inland Revenue to confirm their non-resident status. This change, part of the FBR Overseas Property Rules, ensures that they qualify for the tax rates meant for “filers” under sections 236C and 236K of the Income Tax Ordinance. Importantly, these FBR Overseas Property Rules focus on aligning the tax process with compliance requirements.
Key Details
Real estate experts emphasized that these rules do not introduce any fresh tax exemptions. Instead, the FBR replaced the “non-resident” category on its portal with “late filers.” Consequently, this shift raised concerns about delays and increased complications.
Clarification on Non-Resident Status
Non-resident Pakistanis holding a Pakistan Origin Card (POC) or National ID Card for Overseas Pakistanis (NICOP) remain exempt from certain provisions. Specifically, section 100BA and Rule 1 of the Tenth Schedule exclude property transactions taxed under sections 236C and 236K.
To access these exemptions, overseas Pakistanis must follow a streamlined process:
- Upload a valid POC or NICOP in the IRIS system.
- Receive a provisional Payment Slip ID (PSID).
- Undergo verification of non-resident status by the Commissioner Inland Revenue (CIR).
Once verified, they will receive approval and confirmation through SMS or email.
Concerns Raised
Although the FBR instructed officials to process cases within one business day, experts criticized the added step as unnecessarily complicating the system. They argued that the process delays exemptions that overseas Pakistanis already deserve under existing laws.
Impact on Overseas Pakistanis
These changes complicate the tax process instead of simplifying it for non-residents. Consequently, many overseas Pakistanis find the added requirements frustrating and time-consuming. To address their concerns, policymakers must focus on creating a smoother, more efficient system.
By streamlining FBR Overseas Property Rules, authorities can rebuild trust and ensure ease for overseas Pakistanis engaging in property transactions.
