No tax on annual property rent income of up to Rs0.2 m: FBR
ISLAMABAD (92 News) – The Federal Board of Revenue (FBR) has disclosed that it’s not imposing income tax on annual property rent income up to Rs0.2 million.
An explanatory notification clarifies new taxation system for selling open plots and constructed properties under the Finance Act 2019.
The FBR has exempted tax on annual property rent income (gross) valued at Rs0.2 million and under. “Through the Finance Act 2019, bracket at serial No. 5 is restricted to gross rent up to Rs.4,000,000 and beyond that, three new brackets of gross rent exceeding Rs.4 million have been introduced with rate of tax at 25%, 30% and 35%,” it said.
The bureau will charge 5 per cent IT on rent ranging between Rs200,000 and Rs600,000; 10 per cent on rent between Rs600,000 and Rs1 million; 15 per cent on rent between Rs1 million and Rs2 million; and 35 per cent IT on rent up to Rs8 million.
The holding period for taxation of capital gain of open plots has been increased to eight years and for constructed properties, to four years.