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Section 152A-D, 1% WHT exemption, super tax & tax holiday under Section 108 for IT exports
| Income Bracket (PKR) | Tax Rate | Notes | Reference |
|---|---|---|---|
| Up to 600,000 | 0% | Exempt threshold | |
| 600,001 — 1,200,000 | 5% | Slab 1 | |
| 1,200,001 — 2,400,000 | 15% | Slab 2 | |
| 2,400,001 — 3,600,000 | 25% | Slab 3 | |
| 3,600,001 — 6,000,000 | 30% | Slab 4 | |
| Above 6,000,000 | 35% | Top bracket | |
| IT/ITeS Exports (Registered PSEB) | 1% FED | Under SRO 1128(I)/2011, 0.25% on exports | |
| IT/ITeS Exports (Non-Registered) | 1% FED | Standard rate | |
| Freelance IT Services | 1% FED + WHT | Subject to active taxpayer status | |
| Foreign Remittance via banking | 0% FED | Must declare as IT export on PRC form |
| Portal | URL | Purpose | Reference |
|---|---|---|---|
| IRIS | iris.fbr.gov.pk | Income Tax filing (Individual/Company) | |
| e-FBR | e.fbr.gov.pk | Sales Tax registration & filing | |
| WEBOC | weboc.gov.pk | Customs declarations (import/export) | |
| DIRBS | dirbs.pta.gov.pk | Mobile device IMEI registration | |
| PRAL | pral.com.pk | FBR IT Wing (system support) | |
| ATL (Active Taxpayer List) | fbr.gov.pk/atl | Verify active taxpayer status | |
| FBR TaxRay | fbr.gov.pk | AI-based taxpayer info portal | |
| VOSS (Virtual One Stop Shop) | fbr.gov.pk | Business registration portal |
| Section | Subject | Rate | PSEB Benefit | Status | Reference |
|---|---|---|---|---|---|
| 154A | WHT on IT/ITeS exports | 0.25% (PSEB) / 1% (non-PSEB) final tax | 0.25% vs 1% | Active — TY2024-2026 | |
| 65F(b) | Startup tax credit — 100% for 3 years | 0% for 3 tax years | PSEB registration mandatory | Active | |
| 6A | E-commerce/digital marketplace WHT | 1% digital / 2% CoD | N/A — marketplace operators | New — Finance Act 2025 | |
| 153(1)(b) | WHT on domestic IT services | 4% (IT/ITeS) vs 6% general | No PSEB differential | Active | — |
| 4C | Super tax (high earners) | 1-4% if income > PKR 150M | No PSEB differential | Active — Finance Act 2025 | — |
| 113 | Minimum tax on turnover | 1.5% of turnover | No PSEB differential | Active | — |
| 113C | Alternative Corporate Tax | 17% of accounting income | No PSEB differential | Active | — |
| 2(62A) | Startup definition | Turnover < PKR 100M | PSEB registration required | Active | — |
| 2(30AD) | IT services definition | Software, web, BPO, cloud | PSEB coverage | Active | — |
| 2(30AE) | ITeS definition | Call centers, data processing | PSEB coverage | Active | — |
| 154 | WHT on goods exports | 1% minimum tax | N/A | Active | — |
| — (omitted) | Old IT export exemption (Clause 133 Second Schedule) | Was 0% on all IT export income | Removed | Omitted by Finance Act 2021 | — |
| 65F(c) (omitted) | Old IT export tax credit | Was 100% credit | Removed | Omitted by Finance Act 2022 | — |
Section 154A final tax regime for IT/ITeS exporters — 0.25% with PSEB, 1% without. VERIFIED from FBR sources.
VERIFIED from FBR sources
If you're in the IT/ITeS business and you export, Pakistan gives you one of the most generous tax deals in the world:
Source: TaxPills — IT Sector Taxation in Pakistan 2024 | FBR
✓ Correction: The correct provision is Section 154A (NOT Section 150(2B) as previously stated on this page). This has been verified from FBR sources.
"Final" means that's it ✓ no more tax on that income. You don't need to add it to your normal tax return and calculate a higher rate. The 0.25% or 1% is the complete and final tax obligation on your IT export income.
The tax is collected through Withholding Tax (WHT) by the bank when the foreign remittance lands in your account. You'll see it on your bank statement as a deduction. In most cases, you don't even need to deposit it separately — the bank does it for you.
Example: You receive $10,000 from a US client. At PKR 280/$, that's Rs. 2,800,000.
| Scenario | Rate | Section | Status |
|---|---|---|---|
| IT Export — PSEB Registered | 0.25% (Federal/ICT) | 154A, Second Schedule | VERIFIED |
| IT Export ✓ No PSEB | 1% (Federal/ICT) | 154A, Second Schedule | VERIFIED |
| IT Export ✓ Non-Filer | Double Rate | 154A | VERIFIED |
| Standard Corporate Tax | 29% | First Schedule, Part I, Div II | VERIFIED |
| Export Income (PKR/year) | With PSEB (0.25%) | Without PSEB (1%) | Normal Rate (29%) |
|---|---|---|---|
| 10,000,000 | class="text-success fw-bold">Rs. 37,000 | class="text-warning fw-bold">Rs. 100,000 | class="text-danger">Rs. 2,900,000 |
| 50,000,000 | class="text-success fw-bold">Rs. 125,000 | class="text-warning fw-bold">Rs. 500,000 | class="text-danger">Rs. 14,500,000 |
| 100,000,000 | class="text-success fw-bold">Rs. 250,000 | class="text-warning fw-bold">Rs. 1,000,000 | class="text-danger">Rs. 29,000,000 |
VERIFIED
PSEB registration is the differentiating factor between 0.25% (Federal/ICT) and 1%. Your PSEB registration number must be valid.
| Form | Purpose | Who Files |
|---|---|---|
| Income Tax Return | Annual income declaration | All taxpayers |
| Wealth Statement | Assets & liabilities declaration | Companies & individuals (if income > Rs. 1M) |
| Statement of Assets | Details of owned assets | All |
| Annual Income Tax Return (Company) | Corporate return filing | Pvt Ltd companies |
Per the Finance Act 2025, a new Section 6A was inserted into the ITO 2001 for digital marketplace/e-commerce taxation:
| Payment Type | WHT Rate | Exemption |
|---|---|---|
| Digital/electronic payment | 1% | Exempt if exporter provides banking channel proof |
| Cash on Delivery (CoD) | 2% | No exemption |
IT startups registered with PSEB can claim a 100% tax credit for 3 years under Section 65F(b) of the ITO 2001:
VERIFIED
Introduced in Finance Act 2022, the Super Tax is an additional tax on "imputable income" (progressive). It applies on a very high threshold — most IT exporters won't be affected.
| Imputable Income (PKR) | Super Tax Rate |
|---|---|
| Up to 150 million | 0% |
| 150M–200M | 1% |
| 200M–250M | 1.5% |
| 250M–300M | 2.5% |
| 300M–350M | 3.5% |
| 350M–400M | 5.5% |
| 400M–500M | 7.5% |
| Above 500M | 10% |
Source: TaxPills | TaxationPk
VERIFIED
Additionally, since IT export income is already subject to a final tax (0.25%/1% under Section 154A) collected at source by banks, Section 113's minimum tax does not apply separately. However, if you have domestic income alongside exports, Section 113 may apply to the domestic portion.
VERIFIED
The credit is available for the year of PSEB certification plus the following 2 years (3 years total).
Startups can also obtain an exemption certificate from WHT under Section 153/154/154A.
VERIFIED
Freelancers receiving foreign remittance for IT/IT-enabled services fall under Section 154A (export of services):
| Taxpayer Type | Normal Deadline | Extended (Typical) |
|---|---|---|
| Companies | 30 September | 31 December (with extension) |
| Individuals (Salaried) | 30 September | 31 December |
| Individuals (Business) | 30 September | 31 December |
| Association of Persons (AOP) | 30 September | 31 December |
WHT statements: Monthly (by 15th of following month)
The Active Taxpayer List (ATL) determines filer vs non-filer status. Non-filers pay roughly double WHT rates across all sections.
Super tax is calculated on imputable income. Most IT exporters won't hit the threshold. Section 154A extended till June 30, 2026.
The Income Tax Ordinance, 2001 has been amended through the Finance Act 2025 and Tax Laws Amendment Ordinance 2025.
"Digitally delivered services" means any service delivered over the internet or electronic networks, where the delivery is automated and requires minimal or no human intervention.
This definition is critical for IT exporters — software-as-a-service (SaaS), cloud platforms, and automated digital services fall squarely within this definition, supporting the reduced tax treatment under §6A ITO 2001 — PSEB Reduced Tax for PSEB-registered companies.
Sources: ITO 2001 (Amended 31.07.2025) | ITO 2001 (Amended 20.02.2026) | Finance Act 2025