Property Taxes & Laws in Pakistan (2025–2026)
A complete guide for buyers, sellers, and investors. All rates are per the Finance Act 2024–2025 and updated ECC notifications through March 2026.
§Summary: Who Pays What
| Tax | Paid By | When |
|---|---|---|
| CVT (Capital Value Tax) | Buyer | At time of transfer |
| Stamp Duty | Buyer | At time of registration |
| Registration Fee | Buyer | At time of registration |
| Advance Tax 236K | Buyer | At time of purchase |
| Advance Tax 236C | Seller | At time of sale |
| Capital Gains Tax (CGT) | Seller | On profit from resale |
| FED (Federal Excise Duty) | First Owner / Buyer | At booking or allotment |
| Withholding Tax | Both | Deducted at source |
§1. Capital Value Tax (CVT)
CVT is imposed on the transfer of immovable property (land, houses, buildings). It is collected at source from the buyer during the transaction.
| Detail | Value |
|---|---|
| Rate (2024–2025 & 2025–2026) | 2% of property value |
| Authority | Federal Board of Revenue (FBR) |
| Governing Act | Federal Act 2006 |
| Who Pays | Buyer |
| Applies To | Residential and commercial property |
CVT is calculated on whichever is higher: the FBR valuation table rate or the District Collector (DC) rate.
§2. Stamp Duty
Stamp duty is a provincial tax levied on legal documents related to property transfer. Without payment of stamp duty, the property deed is not legally valid.
| Province | Rate |
|---|---|
| Punjab | 3% of property value |
| Sindh | 3% of property value |
| KPK | 3% of property value |
| Balochistan | 3% of property value |
Some sources cite 1% stamp duty for registration specifically — the total including stamp + registration is approximately 3–5% depending on province and type.
Key Points:
- •Stamp duty is mandatory before property registration
- •Paid at Sub-Registrar / Revenue department office
- •Non-payment leads to legal invalidity of the transaction
§3. Property Registration Fee
Separate from stamp duty, registration fees cover the administrative cost of entering the transaction in the land registry.
| Province | Approximate Rate |
|---|---|
| Punjab | 1% of property value |
| Sindh | Additional provincial charges apply |
| KPK | Provincial rates apply |
Registration is done at the Sub-Registrar's Office or via the respective development authority's transfer office (e.g., DHA Transfer Office, LDA One-Window Cell).
§4. Advance Tax — Section 236K (Buyer)
Advance income tax is deducted from the buyer at the time of property purchase. This is adjustable against the annual income tax return.
| Taxpayer Status | Rate |
|---|---|
| Filer | 3% of property value |
| Non-Filer | 6% of property value |
| Late Filer | Higher rate applies (same as non-filer in most cases) |
Budget 2024–2025 Update: Advance tax now applies from the time of plot booking until balloting or allocation — previously it applied only from possession onward. Payment in installments is permitted.
§5. Advance Tax — Section 236C (Seller)
Sellers must pay advance tax when selling or transferring property. This is also adjustable against annual returns.
| Taxpayer Status | Rate |
|---|---|
| Filer | 3% of sale value |
| Non-Filer / Late Filer | 6% of sale value |
§6. Capital Gains Tax (CGT)
CGT is levied on the profit earned from selling immovable property.
Formula: Capital Gain = Sale Price – (Purchase Price + Improvement Costs + Transaction Costs)
| Holding Period | CGT Rate (Filer) |
|---|---|
| Less than 1 year | 15% |
| 1 to 2 years | 12.5% |
| 2 to 3 years | 10% |
| 3 to 4 years | 7.5% |
| 4 to 5 years | 5% |
| 5 to 6 years | 2.5% |
| More than 6 years | 0% (exempt) |
Non-filers pay significantly higher CGT rates. Properties held for over 6 years are exempt from CGT for filers.
§7. Federal Excise Duty (FED)
FED is levied during the booking, allotment, or transfer of property. It applies to the first owner on residential property.
| Property Type | FED Rate |
|---|---|
| Residential (first owner at booking) | 5% |
| Commercial (allotment or transfer) | 5% |
FED on residential property is a one-time charge applied when you book a residential plot/house in any housing society as the first buyer.
§8. FBR Valuation Tables vs DC Rates
FBR issues valuation tables based on fair market value for each city. The District Collector (DC) also sets rates for each area.
Key Rule: Tax is calculated on whichever is higher — the FBR rate or the DC rate. You cannot declare a lower value to save tax.
- •FBR updates valuations periodically
- •DC rates are set by provincial revenue departments
- •Variation between areas can be significant — DHA phases, for example, have distinct FBR values per phase and block
- •FBR value ≠ market rate — actual market prices are often 2–5× the FBR value; taxes are on the declared/FBR value
§9. Urban Immovable Property Tax (UIPT)
Annual tax on ownership of property within urban limits.
| Province | Notes |
|---|---|
| Punjab | Collected by Excise & Taxation Department annually |
| Sindh | Collected by Sindh Revenue Board |
| KPK | Provincial collection |
Rate varies by property size and location. Residential properties below a certain value threshold may be exempt.
§10. Deemed Rental Income (Section 7E)
Introduced in the Finance Act 2022. Treats certain vacant or undeveloped immovable properties as generating deemed rental income, taxed accordingly.
- •Applies to properties with FBR value exceeding PKR 25 million
- •Rate: 1% of FBR value treated as income (taxed at applicable income slab)
- •Overseas Pakistanis and certain categories are exempt
- •Controversial — multiple court challenges filed; check current FBR status before filing
§11. Withholding Taxes Overview for Real Estate
| Transaction | Filer | Non-Filer |
|---|---|---|
| Buying property (236K) | 3% | 6% |
| Selling property (236C) | 3% | 6% |
| Rental income | Per income slab | Per income slab + surcharge |
The filer vs non-filer gap is significant. Registering as a tax filer (even with zero income) cuts property-related withholding taxes in half.
§12. Punjab-Specific Charges (Additional)
Beyond federal taxes, Punjab charges include:
| Charge | Rate |
|---|---|
| Stamp Duty | 3% of declared value |
| Registration Fee | 1% of declared value |
| CVT | 2% of declared value |
| Total (approximate) | ~6% of declared property value |
For DHA Lahore transfers, the DHA Transfer Office also charges:
- •DHA Transfer Charges (vary per plot size and phase)
- •Membership Transfer Fee
- •NOC Charges (Excise NOC may apply)
§13. Overseas Pakistanis — Special Provisions
- •Federal government introduced tax relief for NICOP holders / overseas Pakistanis
- •CGT and Section 7E exemptions may apply for overseas Pakistanis
- •Still liable for: Stamp Duty, CVT, Registration Fee, and local UIPT
- •DHA Lahore and other major societies have dedicated overseas transfer facilitation
- •Must maintain documentation: NICOP, foreign tax residency, travel records
§14. Important FBR Portals & References
| Portal | Purpose |
|---|---|
| fbr.gov.pk | Tax filing, property valuation tables |
| iris.fbr.gov.pk | Online tax return portal |
| Tax Filer Registration | Become a filer |
| Property Valuation | FBR area-wise valuation rates |
⚠️ Note: Tax laws change with each Finance Act (usually announced in June each year). Always verify current rates at fbr.gov.pk or consult a registered tax advisor before completing any property transaction.
PPG Investments Team
Pakistan Property Guide