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Tax on Fees Waived for Overseas Pakistanis

14 January 2014   (0 Comments)
Posted by: Author: Mubarak Zeb Khan
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Author: Mubaraka Zeb Khan (Dawn)

The government has exempted the overseas Pakistanis from advance payment of income tax on fees in educational institutions in Pakistan.

At the same time, the facility of exemptions will also be available to non-resident Pakistanis against production of a certificate as condition for availing the facility. The non-resident will have to furnish a copy of passport as evidence to the educational institutions that during previous tax year, his/her stay in Pakistan was less than 183 days.

The non-resident will also produce a certificate that he/she has no source income in Pakistan and fee is remitted directly from abroad through normal banking channels to the bank account of the educational institution.

In the budget 2013-14, the government has introduced advance tax which will be collected from a person where annual fee exceeds Rs200,000.

The government has introduced the levy as part of the documentation to bring more people under the tax net.

The decision was announced through a notification SRO17 of 2014 by amending the second schedule of the Income Tax Ordinance 2001.

Moreover, an individual entitled to privileges under the United Nations, a foreign diplomat and a diplomatic mission in Pakistan was also exempted from advance payment on fee in the educational institutions.

At the same time, the government has exempted the provincial and federal government from advance tax on functions and gatherings. This exemption was extended to individuals of UNO, a foreign diplomat and diplomatic mission in Pakistan.

In the last budget, the government notified that an operator or a manager of a marriage hall, marquee, hotel, restaurant, commercial lawn, club, a community place or any other place will have to take advance income tax.

For the tax year 2013, more than 800,000 people have filed their tax returns with the income tax department as against the 711,000 filed last year, showing a marginal increase.

This article first appeared on


Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.


The Act requires that a minimum academic and practical requirments be set to register with a controlling body. Click here for the minimum requirements of SAIT.

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