Tax Slabs for Rental Income from Property has been Revised

The experts at Deloitte Pakistan Chartered Accountants informed the news sources that the Finance Bill 2019 has proposed an increase in the number of tax slabs from five to eight now.

For income exceeding PKR 4,000,000, three new tax slabs have been proposed to match the maximum rate with that of the individual rates.

The schedule for rates of tax on the income from the property based on the recent financial bill are as follows:

The first tax slab states that if the gross amount of the rent is not exceeding than PKR 200,000 than there is no rate of tax involved.

The second tax slab states that if the gross amount of the rental income is exceeding from PKR 200,000 but is not exceeding than PKR 600,000, in such a case the rate of tax involved would be 5% of the amount which exceeds from PKR 200,000.

For the third slab of tax, if the gross amount earned through rent is exceeding from PKR 600,000 but remains in between PKR 1,000,000, in this stance the rate of tax implied would be PKR 20,000 along with 10% of the amount which exceeds PKR 600,000.

The fourth tax slab says that if the gross amount of the rent is exceeding from PKR 1,000,000 but is not exceeding from PKR 2,000,000, in this case, the rate of tax will be PKR 60,000 along with 15% of the amount which exceeds PKR 1,000,000.

The fifth tax slab states that if the gross amount of rent is exceeding from PKR 2,000,000 but remains in between PKR 4,000,000, then in this scenario the rate of tax implied will be PKR 210,000 along with 20% of the amount which exceeds PKR 2,000,000.

The sixth slab of tax is about that if the gross amount of rent is exceeding from PKR 4,000,000 but does not exceed PKR 6,000,000, in this stance the rate of tax will be PKR 610,000 along with 25% of the amount which exceeds PKR 4,000,000.

The second last tax slab i.e. seventh one states that if the gross amount of the rent is exceeding from PKR 6,000,000 but remains in between PKR 8,000,000, in this regard the rate of tax will be 1,110,000 along with 30% of the amount which exceeds PKR 6,000,000.

The last tax slab i.e. eight is about that if the gross amount of rent is more than PKR 8,000,000 than the rate of tax will be PKR 1,710,000 along with 35% of the amount which exceeds PKR 8,000,000.