Property tax
Tax on Buying and Selling Property in Pakistan
A seller pays 2.75% of the transfer value under section 236C, or 11.5% if not on the Active Taxpayer List. A buyer on the list pays a flat 1.25% under section 236K at every value, while a buyer not on it pays 10.5% to 18.5% by band. Both are advance tax, creditable against your final liability rather than a separate charge. Section 7E, the deemed rental income tax, was struck down and repealed in 2026.
Where these figures come from
- Statutory basis
- Income Tax Ordinance, 2001, as amended by the Finance Act 2026, for tax year 2027 (1 July 2026 to 30 June 2027).
- Last checked against the statute
- by BarrioVibe, which files income tax returns through FBR IRIS.
These figures are an estimate computed from the rates above, not tax advice for your situation. Your return depends on facts a form cannot see, so treat the number as a starting point and speak to us before you file on it.
What each side pays, tax year 2027
Note the asymmetry in what the tax is charged on: section 236K works off fair market value, section 236C off the gross consideration received. The statutory language genuinely differs between them.
| Transaction | On the ATL | Not on the ATL |
|---|---|---|
| Selling, section 236C | 2.75% | 11.5% |
| Buying up to Rs 50m, section 236K | 1.25% | 10.5% |
| Buying Rs 50m to 100m | 1.25% | 14.5% |
| Buying above Rs 100m | 1.25% | 18.5% |
What a purchase costs
Enter the value and your status. The calculator applies the bands above and shows both sides of the gap, so you can see what filing would have saved on this one transaction.
Property Purchase TaxAdvance tax is not your final tax
This is the most expensive misunderstanding in Pakistani property. Sections 236C and 236K are advance tax: they are creditable against your final liability for the year and refundable if they exceed it. They are not a separate charge you pay on top of everything else, and they are not the capital gains tax.
A seller therefore pays 236C on the whole transfer value at the time of transfer, and separately owes capital gains tax under section 37 on the actual gain. The 236C already collected comes off that liability. A calculator that reports both without netting them tells you that you owe a sum you do not.
Work out the gain
The calculator asks for the acquisition date first, because nothing else can be decided until it knows which regime applies.
Property Capital GainsSection 7E no longer exists
The deemed rental income tax, which charged you on income you never received from property you merely owned, is gone. The Federal Constitutional Court held section 7E unconstitutional on 7 May 2026, and the Finance Act 2026 then omitted both the section and its rate entry at Division VIIIC of Part I of the First Schedule.
This matters practically because a great deal of published material still explains how to obtain a 7E exemption certificate. If a page is telling you to get one, that page has not been updated since May 2026 and you should treat everything else on it with the same suspicion.
The value the tax is charged on may not be your price
Section 68(4) empowers FBR to notify fair market values, and section 68(6) provides that consideration shall not be taken to be less than the notified value. The practical effect is that both advance taxes are computed on the higher of what you actually paid and what FBR says the property is worth.
Those tables are published as city-wise notifications and revised irregularly rather than on a fixed cycle. Before you budget for a transaction, look up the notified value for the specific locality, because a number several years old is no guide to the current one.
Questions
The questionspeople ask
How much tax do I pay when selling property in Pakistan?
Under section 236C a seller on the Active Taxpayer List pays 2.75% of the gross consideration received, and a seller not on the list pays 11.5%. That is advance tax, creditable against your final liability. Capital gains tax under section 37 is separate and the 236C already collected comes off it.
How much advance tax does a buyer pay on property?
Under section 236K a buyer on the Active Taxpayer List pays a flat 1.25% of fair market value at every value. A buyer not on the list pays 10.5% up to Rs 50 million, 14.5% between Rs 50 and 100 million, and 18.5% above that.
Is section 236K 1.25% or 1.5%?
1.25%. FBR's Salient Features document for Budget 2026-27 states 1.5%, but that document was written against the Finance Bill, which the National Assembly amended before assent on 27 June 2026. The enacted Finance Act 2026 sets 1.25%.
Is 236C the final tax on selling property?
No. It is advance tax, creditable against your final liability for the year and refundable if it exceeds it. Treating it as a final charge is the most common and most expensive mistake in Pakistani property transactions.
How is capital gains tax calculated on property in Pakistan?
Under section 37, and the acquisition date decides the regime. Property acquired on or after 1 July 2024 is taxed at a flat 15% for a person on the Active Taxpayer List, and property acquired earlier stays on a holding-period table that reaches nil. The mechanics, the cost base and the same-year resale rule are set out in our capital gains guide.
Is section 7E still applicable?
No. The Federal Constitutional Court held section 7E unconstitutional on 7 May 2026 and the Finance Act 2026 omitted both the section and its rate entry. Pages explaining how to obtain a 7E exemption certificate have not been updated since.
Is there still a late filer rate on property?
No. The late filer tier was created by the Finance Act 2024 through Rule 1A of the Tenth Schedule and applied only to sections 236C and 236K. The Finance Act 2026 omitted Rule 1A, so late filers now pay the same rates as on-time filers.
Is tax charged on my purchase price or the FBR value?
On the higher of the two. Section 68(4) lets FBR notify fair market values and section 68(6) provides that consideration shall not be taken to be less than the notified value. Check the notified value for the specific locality before you budget.
Buying or selling, and want the figure checked?
The advance tax, the capital gain and the provincial charge are three different questions on one transaction. Getting them straight before the transfer is cheaper than correcting afterwards.