July 1, 2019 (MLN): The Federal Board of Revenue (FBR) has made new amendments regarding sale and purchase of immovable properties in the Finance Bill, 2019, which was passed in the National Assembly of Pakistan on June 28, 2019.
These amendments have been made in Section 236C and 236K of Income Tax Ordinance, 2001, and are applicable from July 1, 2019.
As per the amendment made in Section 236C, an advanced tax of 1% for filers and 2% for non-filers on sale or transfer of immovable properties is applicable. However, no such tax will be collected in case the property is held for more than five years.
Under Section 236K, an advanced tax of 1% of fair market value for filers, and 2% of fair market value for non-filers on purchase or transfer of immoveable properties is applicable. Under this section, the threshold of Rs.4 million has been abolished and withholding tax on purchase is to be collected irrespective of the property’s value.
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