LAHORE: The Federal Board of Revenue (FBR) has introduced a new simple, convenient and the hassle-free tax regime for Non Resident Pakistanis (NRPs) having Roshan Digital Account (RDA).

This regime includes all investments made by NRPs in government debt securities, both conventional and Shariah-compliant, stock market, mutual funds and real estate through RDAs.

As per details, profit earned on RDA deposits is tax exempt. No withholding tax will be deducted against profit on RDA deposits. There is no need to obtain an exemption certificate from the FBR and filing of tax returns on profit from RDA deposits.

Similarly, there is no withholding tax on cash withdrawals or account-to-account transfer by NRPs, as the NRPs having RDAs have been exempted from the application of clause 236P, 231 and 231A.

In the case of investment in Naya Pakistan Certificates, there would be full and final tax @ 10 percent on profit on NPCs for NRPs and such resident Pakistanis having declared assets abroad.

There is also no need to file tax returns on profit on NPCs. Regarding investment in shares and mutual funds, there would be a full and final tax of 15 percent on capital gains, dividends received from mutual funds and companies other than IPPs and the companies which are tax exempt. The tax rate on dividends from IPPs is 7.5 percent and from tax-exempt companies is 25 percent.

Similarly, there would be no penalty or doubling of the tax rate due to the absence from Active Taxpayer’s List (ATPL). So far as investment in property is concerned, there would be full and final capital gains tax of 1 percent on value at the time of sale of properties and on value at the time of purchase of properties. There would be no need to file tax returns for NRPs on capital gains on sale of properties.

Copyright Business Recorder, 2021