Finance Act 2026 — Effective July 1, 2026. Section 236K rates revised: Filer & Overseas 1.25% flat · Non-Filer 10.5%–18.5% (slab-based) · Late Filer category abolished. See what changed →or use 236K tax calculator.
Quick Answer — Section 236K (TY 2026-27)
Section 236K is an advance income tax collected from property buyers at the time of registration or transfer under the Income Tax Ordinance 2001. Under Finance Act 2026, filer and overseas rates are now a single flat rate, while non-filer rates remain slab-based:
1.25%
Flat — all values
1.25%
Same as Filer
10.5%–18.5%
Slab-based by value
Abolished
Finance Act 2026
Finance Act 2026
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What Is Section 236K Advance Tax?
Section 236K of the Income Tax Ordinance 2001 requires property buyers to pay an advance income tax at the time of property registration or attestation. This is an advance withholding tax collected at the property transfer stage — not a separate property levy — and is administered by the Federal Board of Revenue (FBR).
The registering authority — whether it is a DHA transfer office, LDA window, Sub-Registrar Office, or housing society — collects this tax before completing the transfer deed. It applies to plots, houses, apartments, farmhouses, files, and booking allotments across Pakistan.
Key distinction: Section 236K is an advance income tax on purchase. It is not Capital Gains Tax (CGT), stamp duty, or CVT — all of which are separate obligations.
Under Finance Act 2026, effective July 1, 2026, the rate structure was significantly simplified. Filers and overseas Pakistanis pay a single flat 1.25% on all property values. Non-filers continue on a slab-based structure — 10.5%, 14.5%, or 18.5% depending on property value. The Late Filer category was abolished entirely.
Section 236K Tax Rates — Tax Year 2026-27
The table below shows the confirmed advance tax rates under Section 236K for Tax Year 2026-27, effective July 1, 2026 under Finance Act 2026.
| Filer Status | Rate (TY 2026-27) | Applies To | Adjustable? |
|---|---|---|---|
| Filer / ATL | 1.25% flat | All property values | ✓ Yes |
| Overseas Pakistani (NICOP / POC) | 1.25% flat | Same as Filer (conditions apply) | ✓ Yes |
| Non-Filer — Up to Rs. 50M | 10.5% | Up to Rs. 50 Million | ✗ Final Tax |
| Non-Filer — Rs. 50M–100M | 14.5% | Rs. 50M to Rs. 100 Million | ✗ Final Tax |
| Non-Filer — Above Rs. 100M | 18.5% | Above Rs. 100 Million | ✗ Final Tax |
| Late Filer | Abolished | Category removed — Finance Act 2026 | — |
Key change from TY 2025-26: The Late Filer category has been abolished under Finance Act 2026. Filer and Overseas rates are now a single flat 1.25% — replacing the previous slab-based filer rates (1.5% / 2.0% / 2.5%). Non-filer rates remain slab-based at 10.5% / 14.5% / 18.5% depending on property value.
Filer vs Non-Filer: Real Cost Difference
The difference between filer and non-filer status directly affects how much advance tax a buyer pays under Section 236K. The table below shows real PKR savings at common property values.
| Property Value | Filer Tax (1.25%) | Non-Filer Tax (slab) | Saving (Being Filer) |
|---|---|---|---|
| Rs. 50 Lakh (≤Rs. 50M slab) | Rs. 62,500 | Rs. 5,25,000 (10.5%) | Rs. 4,62,500 |
| Rs. 1 Crore (≤Rs. 50M slab) | Rs. 1,25,000 | Rs. 10,50,000 (10.5%) | Rs. 9,25,000 |
| Rs. 2 Crore (≤Rs. 50M slab) | Rs. 2,50,000 | Rs. 21,00,000 (10.5%) | Rs. 18,50,000 |
| Rs. 7.5 Crore (Rs. 50M–100M slab) | Rs. 9,37,500 | Rs. 1,08,75,000 (14.5%) | Rs. 99,37,500 |
| Rs. 15 Crore (above Rs. 100M slab) | Rs. 18,75,000 | Rs. 2,77,50,000 (18.5%) | Rs. 2,58,75,000 |
On a Rs. 1 Crore property, being on the Active Taxpayer List (ATL) saves Rs. 9.25 Lakh in advance tax — filer pays only Rs. 1.25 Lakh versus the non-filer's Rs. 10.5 Lakh. That gap widens dramatically at higher property values, where non-filer rates climb to 14.5% and 18.5%. Becoming a filer before any property purchase is one of the highest-ROI financial decisions in Pakistan real estate.
Not on the ATL yet? Becoming a filer costs as little as Rs. 1,000 in ATL surcharge and can save you lakhs on property transactions.
How Is 236K Advance Tax Calculated?
The advance tax under Section 236K is not simply calculated on the agreed sale price between buyer and seller. The tax base is determined by taking whichever is higher among the following three values:
Agreed Transaction Price
The purchase price stated in the sale deed
FBR Valuation Rate
Zone-specific rate published by FBR for that locality
DC Rate
Deputy Commissioner district valuation rate
This is a critical point most buyers miss. Even if an agreement is signed at Rs. 80 Lakh, if the FBR Valuation Rate for that zone is Rs. 1.05 Crore, the 236K advance tax will be calculated on Rs. 1.05 Crore — not Rs. 80 Lakh.
Worked Example (TY 2026-27)
Scenario: DHA Lahore plot purchase — Rs. 80 Lakh agreed price
- Agreed price between buyer and seller: Rs. 80,00,000
- DC Rate for the area: Rs. 95,00,000
- FBR Valuation Rate for that zone: Rs. 1,05,00,000
- Tax base used: Rs. 1,05,00,000 (highest of the three)
- Buyer is ATL filer → 1.25% flat
- Advance tax payable: Rs. 1,05,00,000 × 1.25% = Rs. 1,31,250
If the buyer were a non-filer: Rs. 1,05,00,000 × 10.5% (≤Rs. 50M slab) = Rs. 11,02,500 — nearly 9× more than the filer amount.
Always check the FBR valuation rate for your specific plot, sector, or zone before signing any agreement. The registering authority at DHA, LDA, or Bahria Town generates the PSID based on FBR's rate — not the agreed deal price.
Who Pays Section 236K Tax — and When?
The buyer (purchaser) of the immovable property pays Section 236K advance tax. This is collected by the registering authority — DHA transfer office, Sub-Registrar, LDA, CDA, or housing society — before the transfer deed is registered or attested.
Section 236K applies broadly to transactions involving:
- Residential plots and houses
- Apartments and flats
- Commercial properties and offices
- Farmhouses and agricultural land
- Property files (booking and allotment stage — see Section 9 below)
- Transfer of DHA, LDA, Bahria Town, and CDA sector allotments
Not the seller's tax. Section 236K is the buyer-side advance tax. The seller pays a separate advance tax under Section 236C. Both apply in the same transaction — from different sides.
How to Use the 236K Tax Calculator
The 236K tax calculator on this page is free, instant, and requires no login. Here is how to use it for an accurate advance tax estimate:
- Select Tax Year — TY 2026-27 is selected by default with Finance Act 2026 rates.
- Enter the property value — use the higher of the agreed price, FBR valuation rate, or DC rate for your area.
- The calculator shows your advance tax for Filer, Overseas, and Non-Filer status side by side.
- Use the Tax Year 2025-26 option to compare with previous year rates if needed.
For the full cost of property registration — including stamp duty, registration fee, and TMA charges — also try the Property Registration Cost Calculator. For seller-side advance tax, use the 236C Tax Calculator.
How to Pay Section 236K Tax — Step by Step
Paying advance tax under Section 236K follows a defined FBR process. The steps below apply to most residential and commercial property transfers in Pakistan.
Confirm the Tax Base
Before signing any sale agreement, verify the FBR Valuation Rate and DC Rate for your property zone. Use the higher of these or the agreed price as the tax base.
Verify Your ATL Status
Check your filer status at atl.fbr.gov.pk or via SMS 9966 with your CNIC number. Do this at least 30 days before the transfer date to allow time to update if needed.
Eligibility Certificate for High-Value Transactions
If the property value exceeds Rs. 100 million, obtain an Eligibility Certificate under Section 114C from the Chief Commissioner Inland Revenue (CCIR). The registering authority will block the transfer without it.
PSID Generation
The registering authority generates a PSID (Payment Slip ID) on the FBR e-payment portal using the buyer's CNIC or NTN. The PSID reflects the correct tax amount and filer status.
Pay Through Official Banking Channel
Pay the PSID at any authorised bank branch. Under Section 75A, payment through cash is not accepted for transactions above Rs. 5 million — use a banking channel only.
Keep Your PSID Receipt
Save the stamped PSID payment receipt. Filers need this to claim the advance tax as adjustable against their annual income tax return in FBR IRIS.
Is 236K Tax Adjustable or a Final Tax?
This is one of the most common questions about Section 236K, and the answer depends entirely on filer status.
✓ For Filers (ATL)
The advance tax paid under Section 236K is fully adjustable against annual income tax liability. It is deductible from the total tax due when filing the annual return. If excess tax was paid, a refund can be claimed through the FBR IRIS portal.
✗ For Non-Filers
The advance tax is a final tax — not recoverable for non-filers. It cannot be offset against any other liability, and no refund is available. This is a permanent cost of the transaction for those not on the ATL.
This distinction makes filer status a direct financial decision, not just a compliance formality. For a Rs. 2 Crore property (≤Rs. 50M slab), the non-filer pays Rs. 21,00,000 at 10.5% as a final, unrecoverable cost — while the filer pays only Rs. 2,50,000 at 1.25%, which is adjustable against the annual income tax return.
Section 236K vs Section 236C — Buyer vs Seller Tax
Both Section 236K and Section 236C are advance withholding taxes on property, but they apply to different parties in the same transaction. Understanding both is important for accurate total cost planning.
| Feature | Section 236K (Buyer) | Section 236C (Seller) |
|---|---|---|
| Who Pays | The purchaser (buyer) | The transferor (seller) |
| Tax Base | Higher of agreed price, FBR rate, or DC rate | Higher of agreed price, FBR rate, or DC rate |
| TY 2026-27 Filer Rate | 1.25% flat | Check 236C calculator |
| Applies to CGT? | No — separate from Capital Gains Tax | No — CGT (Section 37) is separate |
| When Collected | At registration / transfer | At registration / transfer |
Property advance tax is not the same as Capital Gains Tax. CGT under Section 37 is a separate tax levied on the profit the seller makes on the sale — calculated based on the holding period and profit margin. Section 236K is purely an advance income tax on the purchase amount. Use the Capital Gain Tax Calculator for seller-side CGT estimation.
Section 236K for Overseas Pakistanis (NICOP / POC)
Overseas Pakistanis holding a NICOP (National Identity Card for Overseas Pakistanis) or POC (Pakistan Origin Card) are eligible for the filer rate of 1.25% flat — but only if specific conditions are met.
Conditions for the overseas filer rate:
- The buyer must hold a valid NICOP or POC
- The buyer must have non-resident status — spending fewer than 183 days per year in Pakistan
- The registering authority must use the "Overseas Pakistanis" process on the FBR portal — this is a separate workflow from the standard transfer process
- Ideally, property payment should originate from a Roshan Digital Account or Foreign Currency Value Account (FCVA) for full compliance
Critical warning for overseas buyers: If the registering authority does not follow the overseas process on the FBR portal on the day of transfer, the system automatically defaults to non-filer rate. There is no on-the-day fix. Arrange documentation and confirm the process with the DHA, LDA, or Sub-Registrar office at least one week before the transfer date.
Does 236K Apply to Property Files and Bookings?
Yes — and this is a knowledge gap most property investors overlook. Since Finance Act 2024-25, Section 236K applies from the booking or allotment stage, not only at the physical possession or final transfer deed stage.
File investors in societies like DHA, Bahria Town, LDA Avenue, and CDA sectors must factor 236K advance tax into their initial investment cost at booking. The developer or society is responsible for collecting this tax from the buyer at the time of booking/allotment.
Quick Example — Property File Booking
Buying a 5-marla plot file in Bahria Town Lahore at Rs. 40 Lakh → 236K applies at booking. Filer advance tax: Rs. 40,00,000 × 1.25% = Rs. 50,000. Non-filer: Rs. 1,00,000.
Total Property Transfer Cost in Pakistan
Section 236K is just one component of the real estate transaction cost. Buyers need to budget for all applicable charges. The table below provides a provincial breakdown of the major transfer-related costs.
| Cost Component | Punjab | Islamabad | Sindh | KPK |
|---|---|---|---|---|
| Section 236K (Buyer) | 1.25% (filer) | 1.25% (filer) | 1.25% (filer) | 1.25% (filer) |
| Section 236C (Seller) | Varies by filer status | Varies by filer status | Varies by filer status | Varies by filer status |
| Stamp Duty | 1% | 1% | 2% | 3% |
| Capital Value Tax (CVT) | Abolished in most provinces — verify locally | |||
| Registration Fee | Varies by district and property type | |||
| Section 7E (Property Tax) | Abolished — Finance Act 2024-25 | |||
Use the Property Registration Cost Calculator to estimate the full transaction cost including stamp duty, registration fee, and all applicable charges for your province.
Common Mistakes Property Buyers Make with Section 236K
Mistake 1 — Using the Agreed Price Instead of FBR Rate
Fix: Always check the FBR valuation rate for your property zone before token payment. Use the highest of the three values as the tax base.
Mistake 2 — Not Checking ATL Status Before Token Payment
Fix: Verify ATL status at atl.fbr.gov.pk at least 30 days before transfer. If you are not on the ATL, pay the ATL surcharge to restore filer status in time.
Mistake 3 — Paying 236K in Cash for Rs. 5M+ Transactions
Fix: Under Section 75A, payment through cash is not accepted for transactions above Rs. 5 million. Always pay via banking channel using the PSID generated by FBR.
Mistake 4 — Not Saving the PSID Receipt
Fix: Keep the stamped PSID payment receipt. Filers need it to claim the advance tax as adjustable in their annual income tax return on FBR IRIS.
Mistake 5 — Overseas Buyers Not Arranging NICOP Process Before Transfer
Fix: Overseas Pakistanis must arrange the NICOP/POC process with the registering authority at least one week before transfer. The FBR system defaults to non-filer rate if the overseas process is not selected on the day.
Mistake 6 — Missing Eligibility Certificate for Rs. 100M+ Deals
Fix: For property transactions above Rs. 100 million, obtain the Eligibility Certificate under Section 114C from CCIR before the transfer date. Registration is blocked without it.
Mistake 7 — Confusing 236K with Capital Gains Tax
Fix: Section 236K is advance income tax paid by the buyer at purchase. Capital Gains Tax (Section 37) is a separate tax paid by the seller based on profit and holding period. Use the Capital Gain Tax Calculator for CGT.
Planning Tips for Property Buyers
- Check ATL status 30 days before any transaction — verify at atl.fbr.gov.pk to avoid higher rates
- Budget using FBR rates, not market prices — FBR valuation rate is the most common tax base surprise
- Factor 236K into your initial booking cost — especially for property file investors in DHA, Bahria Town, and LDA projects
- Use official banking channels for all transactions — Section 75A compliance is mandatory above Rs. 5 million
- Keep all documentation — PSID receipt, transfer deed, FBR payment proof for annual return filing
- Consult a tax professional for transactions above Rs. 100 million or involving overseas buyer arrangements
- Cross-check rates annually — Section 236K rates change with each Finance Act; always use the TY 2026-27 rates from this page for current transactions
Related Property & Tax Calculators
Conclusion
Section 236K advance tax is one of the most significant costs in a property purchase in Pakistan. Under Finance Act 2026, filers and overseas Pakistanis pay a single flat 1.25% on all property values — a significant simplification. Non-filers continue on a slab-based structure: 10.5% up to Rs. 50M, 14.5% from Rs. 50M–100M, and 18.5% above Rs. 100M, with advance tax being a final, non-recoverable cost. The Late Filer category was abolished entirely under Finance Act 2026.
Using the 236K tax calculator on this page gives an instant, accurate advance tax estimate for any property value. Use it before signing any sale agreement — and always verify the FBR valuation rate for your zone, not just the market price.
For complete transaction cost planning, combine the results with the 236C Calculator (seller-side tax) and the Property Registration Cost Calculator.
Disclaimer: All calculations are reference estimates based on Finance Act 2026 rates effective July 1, 2026. Consult a qualified tax consultant before completing any property transaction. Verify final rates with FBR.gov.pk.
Previous Tax Year Rates — Section 236K
Historical rates are provided for reference only. All current property transactions use TY 2026-27 rates above.
Frequently Asked Questions — Section 236K
Section 236K of the Income Tax Ordinance 2001 imposes an advance income tax on property buyers at the time of purchase or transfer of immovable property in Pakistan. It is collected by the registering authority — DHA, Sub-Registrar, LDA, or housing society — before the transfer deed is completed. Under Finance Act 2026, filers and overseas Pakistanis pay 1.25% flat on all property values. Non-filers pay 10.5% (up to Rs. 50M), 14.5% (Rs. 50M–100M), or 18.5% (above Rs. 100M) based on property value.
The buyer (purchaser) pays Section 236K. The seller pays a separate advance tax under Section 236C. Both apply in the same transaction but from opposite sides. The registering authority collects both at the time of property transfer.
For Tax Year 2026-27 under Finance Act 2026, the Section 236K rate for active ATL filers is 1.25% flat on all property values. There are no slab distinctions — the same 1.25% applies whether the property is Rs. 50 Lakh or Rs. 50 Crore. Non-filers pay a slab-based rate: 10.5% for properties up to Rs. 50 Million, 14.5% for Rs. 50M–100M, and 18.5% for above Rs. 100M. The Late Filer category has been abolished.
For active filers on the ATL, Section 236K advance tax is fully adjustable against the annual income tax liability. If excess tax was paid, a refund can be claimed through the FBR IRIS portal when filing the annual return. For non-filers, it is a final tax — it cannot be recovered or offset against any future liability.
Yes, overseas Pakistanis holding a valid NICOP or POC and with non-resident status (spending fewer than 183 days per year in Pakistan) can access the filer rate of 1.25%. The registering authority must use the Overseas Pakistanis option on the FBR portal. This must be arranged before the transfer date — the FBR system defaults to non-filer rate if the correct process is not selected on the day.
Section 236K is advance income tax paid by the buyer (purchaser) of the property. Section 236C is advance income tax paid by the seller (transferor). Both apply in the same transaction, are collected by the registering authority, and are separate from Capital Gains Tax. Use the 236C Tax Calculator for seller-side estimation.
Yes. Since Finance Act 2024-25, Section 236K applies from the booking or allotment stage — not only at physical possession or final transfer. File investors in DHA, Bahria Town, LDA, and CDA projects must factor 236K advance tax into their initial investment cost at the time of booking. The developer or society collects the tax at booking.
For Tax Year 2026-27, a filer buying a Rs. 1 Crore property pays: Rs. 1,00,00,000 × 1.25% = Rs. 1,25,000 in advance tax. A non-filer on the same property pays at 10.5% (≤Rs. 50M slab): Rs. 1,00,00,000 × 10.5% = Rs. 10,50,000. Note that the tax base is the higher of the agreed price, FBR valuation rate, or DC rate — not necessarily the agreed price.
No. Section 236K is advance income tax on the purchase by the buyer. Capital Gains Tax under Section 37 is a separate tax on the profit made by the seller, calculated based on holding period and profit margin. These are two completely different taxes with different calculations, payers, and legal provisions.
The registering authority requires the buyer's CNIC or NTN to generate the PSID on the FBR e-payment portal. For overseas Pakistanis, a valid NICOP or POC is also required and the overseas process must be pre-arranged. For transactions above Rs. 100 million, an Eligibility Certificate under Section 114C from the Chief Commissioner Inland Revenue (CCIR) is mandatory before the transfer can proceed.
The FBR Valuation Rate is a zone-specific benchmark rate published by the Federal Board of Revenue for different localities across Pakistan. The 236K advance tax is calculated on the highest of the agreed transaction price, FBR valuation rate, or DC (Deputy Commissioner) rate — not necessarily the price on the sale deed. If the FBR rate for your zone is higher than your agreed price, the tax is calculated on the FBR rate.
