Government of Pakistan

Revenue Division
Federal Board of Revenue
*****
C.No.4(31)IT-Budget/2023-114505-R Islamabad, the 21" July, 2023

CIRCULAR NO. 01 OF 2023-24

Subject: INSTRUCTIONS REGARDING MODE AND MANNER FOR

Under section 236C of the Income Tax Ordinance 2001(the Ordinance), any
person responsible for registering, recording, or attesting transfer of any immovable
property has been designated as the person responsible (hereinafter referred to
'transferring authority') to collect advance adjustable Income tax from the seller or
transferor. The rate of tax collection is 3% of the gross amount of the consideration
received by the seller or transferor in case of seller's/transferor's name if appearing
on the Active Taxpayers' List (ATL) and 6% in case of non-ATL seller/transferor.
Through Finance Act, 2022 section 7E was introduced whereby, for tax year
2022 and onwards, every resident person has been treated to have derived as income,
an amount equal to 5% of the fair market value of the capital asset situated in
Pakistan subject to exclusions of the capital assets provided under sub-section (2).
The said deemed income is chargeable to tax at the rate of 20% (effective rate 1% of
fair market value of immoveable property).
Finance Act 2023 has introduced a new sub-section (2A) in section 236C of
the Ordinance which places a bar on the transferring authority for registering,
recording or attesting transfer of any immovable property unless the seller or
transferor has discharged his tax liability under section 7E of the Ordinance and
evidence to this effect has been furnished to the transferring authority in the
prescribed mode, form and manner.
The following instructions are issued for catering for situations arising out of
change in law prescribing mode, form and manner of collection of payment of tax
u/s 7E:

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 (A) Where the seller or transferor is on ATL:
The said seller or transferor will provide evidence to the transferring authority
that he has discharged his liability u/s 7E in any of the following modes:
If the seller/transferor has not already paid the tax u/s 7E along with his
income tax return filed for TY 2022, then, such person is required to
pay the due amount of tax payable under section 7E of the Ordinance
and produce evidence to the transferring authority. For this purpose, a
separate payment challan (CPR) has been provided in FBR online
payment system. The payment made into government treasury through
CPR in this regard will be treated as evidence for the purpose and to the
extent of newly inserted sub-section (2A) of section 236C of the
Ordinance; or
If the seller / transferor has already declared the said property in his
declaration u/s 7E filed along with his income tax return for tax year
2022 or the said seller/transferor is not required to pay tax u/s 7E due
to any stay granted by any court of law or authority, then the seller /
transferor will furnish a certificate annexed as Form 'A' to this circular
duly issued by the Commissioner Inland Revenue holding jurisdiction
over the seller/transferor. The certificate issued by the Commissioner
Inland Revenue will be treated as evidence for the purpose and to the
extent of newly inserted sub-section (2A) of section 236C of the
Ordinance;
For the purpose of issuance of above certificate, the seller/transferor
will fill the requisite particulars in attached Form 'A' and submit the
same to the Commissioner Inland Revenue holding jurisdiction over the
person. The Commissioner Inland Revenue will examine the particulars
and will accordingly issue the certificate.
The said certificate will be issued by the Commissioner Inland Revenue
within 7 days of the receipt of the pre-filled form 'A' submitted by the
seller/transferor.

If property owner is more than one person, each person shall discharge
liability u/s 7E with respect to his or her respective share in the said
property in any of the modes described above.

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 (B) Where the seller/transferor is a non-ATL person:
Such person is required to pay the due amount of tax payable under
section 7E of the Ordinance and provide evidence to the transferring
authority. For this purpose, a separate payment challan (CPR) has been
provided in FBR online payment system. The payment made into
government treasury through CPR in this regard will be treated as
evidence for the purpose and to the extent of newly inserted sub-section
(2A) of section 236C of the Ordinance.
5. These instructions have been issued for uniform application of procedure by
all transferring authorities. Based on the feedback and monitoring of the procedure,
suitable amendments if necessary will be made to these instructions.

(Naveed Mukhtar)
Secretary (Income Tax Budget)

Circulation:
SA to Revenue Secretary/ Chairman, FBR,
SA to Member (Inland Revenue - Policy), FBR
SA to Member (Inland Revenue - Operations), FBR
SA to Member (IT), FBR
All Chief Commissioners Inland Revenue, LT0s, MTO, CTOs & RTOs
President Pakistan Tax Bar Association
Webmaster for placement on FBR website

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 Form 'A'
CERTIFICATE FOR THE PURPOSE OF SECTION 236C (2A) TO BE PRESENTED BY SELLER/TRANSFEROR TO
REGISTERING/RECORDING/ATTESTING AUTHORITY FOR THE TRANSFER OF IMMOVABLE PROPERTY

PARTICULARS OF SELLER/TRANSFEROR
1 Name
2 Address
(Please write complete address along with of City of District)
3 NTN CNIC/Inc. No./Passport No.
(Please attach photocopy of CNiC)

LOCATION & PARTICULARS OF THE PROPERTY

Commercial Residential Industrial Agricultural (excluding Farmhouse) Farmhouse Any other Immovable capital assets
4 Type
5 Type Plot Flat ri Constructed
Land Size Kenai Marla Sq. Yards Sq. feet (Pl. select only one unit of measure)
6
Covered Area Sq. Yards Sq. feet (PI. select only one unit of measure)
7

8 Address
Plot/ House/ Flat/ Shop/ Office No. Street /Lane etc. No.

9
Sector / Phase! Mohalla / Block etc.
10
Province District Tehsil / Town

11 If chargeable u/s 7E, fair market value of property declared in return of Income Rs.

12 Amount of Tax paid u/s 7E on the property Rs.

13 Whether exclusion u/s 7E (2) claimed (Yes/No)

14 Reason for exclusion (please specify)

Verification

I/We solemnly declare that the particulars given in this application are correct and complete to the best my knowledge and belief,
and that nothing has been concealed.
15 Date (ddirnm/yyyy)

16 CNic/Passport No.
(Please attach photo copy) Name & Signature of Seller/Transferor

(FOR OFFICIAL USE OF COMMISSIONER INLAND REVENUE)

It is certified that the taxpayer has duly complied with the provisions u/s 7E as applicable to the taxpayer for TY 2022 in respect of above
mentioned immovable property or the taxpayer is not required to pay tax u/s 7E due to exemption in law or stay order of the Competent
Authority/Court of Law.

Date (dclimmAsyyy)
Name, Signature & Official Stamp

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