Karachi: The Federal Board of Revenue (FBR) on Wednesday (August 10) withdrew the holding time exemption for collecting advance tax on the sale or transfer of immovable property, news sources reported. This authority will now collect advance tax on the sale or transfer of immovable property regardless of holding time.
In this regard, the FBR notified the cancellation of sub-section (3) of Section 236-C of the Income Tax Ordinance-2001, allowing tax collection from immovable property. Following the revocation exemption period, the FBR will collect income tax on the sale and transfer of all non-movable assets. Moreover, under the Finance Act of 2022, the FBR raised the advance tax rate on the sale or transfer of immovable property from 1% to 2%. Now, the buyers and sellers not on the active taxpayer list will be taxed at 250% of the rate set in Division XVIII of Part IV of the First Schedule under Section 236K of the Income Tax Ordinance, 2001.
At the same time, those buyers and sellers on the active taxpayer list will pay a 100% tax increase under Section 236C. It is important to mention that, under the old tax ordinance, the government had given buyers and sellers an exemption period of four years. Any plot owner who will sell the plot within the due time was exempted from the income tax.
Nauman Ahmad is an imaginative Pisces whose love for literature and nature is unparalleled. When he's not reading or hiking, he's sleeping and eating, which gives him plenty of energy for his next adventure.
