Section 236K Buyer Advance Tax
ATL rate depends on the fair market value band under Section 236K.
Rs. 10,000,000 x 1.5% = Rs. 150,000 federal advance tax.
What a Buyer May Pay
| Charge | Rate / Basis | Authority |
|---|---|---|
| Section 236K advance tax | 1.5% / 2% / 2.5% by fair market value band | FBR / Federal |
| Stamp duty | Varies by province and property type | Provincial |
| Mutation / transfer fee | Varies by local authority | Provincial / Local |
| Registration / documentation cost | Varies | Registrar / Local |
Buyer Tax Examples Across the ATL Value Bands
| Property Fair Market Value | Finance Act 236K Tax |
|---|---|
| Rs. 5,000,000 | Rs. 75,000 |
| Rs. 10,000,000 | Rs. 150,000 |
| Rs. 20,000,000 | Rs. 300,000 |
| Rs. 50,000,000 | Rs. 750,000 |
| Rs. 75,000,000 | Rs. 1,500,000 |
| Rs. 120,000,000 | Rs. 3,000,000 |
After Buying: What to Do in Your Return
- Keep the sale deed, registration papers, payment proof, and 236K challan.
- Add the property to your IRIS wealth statement as an immovable property asset.
- Record the source of funds used for purchase, such as salary savings, business income, gift, inheritance, or loan.
- Keep provincial payment receipts because FBR may ask for proof later.
Buyer Documents and Calculation Checklist
Before paying the buyer-side tax, make sure the calculation is based on the same property value that will be used in the transfer documents. Buyers should also check whether the amount quoted by a dealer or property office includes only Section 236K or also includes provincial stamp duty, registration, mutation, and society or authority fees.
| Item | What to Confirm | Keep as Proof |
|---|---|---|
| Buyer CNIC / NTN | Name and number match the tax challan and transfer file. | CNIC copy, NTN/IRIS profile, ATL screenshot |
| Property value | Declared value, FBR fair market value, and authority value are understood. | Valuation note or official challan basis |
| Payment trail | Bank transfer, pay order, or documented source of funds is available. | Bank statement and payment instrument copy |
| Registration charges | Provincial and local charges are separate from federal advance tax. | Registrar or authority receipts |
If someone else pays on your behalf, such as a parent, spouse, business partner, or overseas family member, keep the gift, loan, remittance, or agreement record. FBR may ask how the buyer funded the property even when the tax challan itself was paid correctly.
Common Buyer Mistakes
Most buyer-side problems happen because the buyer calculates only the federal advance tax and forgets the provincial or authority charges. Another common issue is paying from an account that does not clearly match the buyer's declared source of funds.
- Do not assume 236K is the total cost of transfer.
- Confirm the value used by FBR and the value used by the registrar.
- Keep bank proof for every major payment.
- Ask whether society, development authority, or registrar fees apply.
- Update your IRIS wealth statement after the purchase.
Before Paying Token Money
Buyers should complete basic tax and document checks before paying token money. Once a sale agreement is signed, changing the value, party name, payment route, or transfer timeline can become difficult. Ask the registrar, society, or authority for a realistic estimate of total transfer cost before agreeing on the final cash schedule.
- Check ownership record and seller CNIC/NTN.
- Confirm FBR value and provincial transfer value.
- Agree whether buyer or seller pays each charge.
- Keep written evidence for advance payment or token money.
Final Property Tax Verification Checklist
Before a property transfer, separate the federal tax calculation from the provincial and local charges. Federal items usually include 236K, 236C, CGT, and return-filing treatment. Provincial or local items can include stamp duty, mutation fee, registration fee, society transfer charges, and annual property tax. Mixing them together can make the deal look cheaper than it really is.
Keep the sale agreement, transfer deed, payment proof, FBR challans, valuation basis, CNIC/NTN details, and authority receipts in one file. These documents are useful when filing the annual return, updating the wealth statement, claiming advance tax, or explaining the source of funds.
Official Sources
When to Ask for Professional Review
Get a professional review before transfer if the property is jointly owned, inherited, gifted, mortgaged, under litigation, held by a company, transferred through a society, or paid through multiple bank accounts. These facts can change the documents required and the way the transaction is reported in the annual income tax return.
Also review the file if the declared value, FBR value, provincial value, and actual payment amount are different. A clear explanation before filing is much easier than fixing a mismatch after a notice or audit query.
Final Practical Reminder
Use this guide for planning, then confirm the final amount, status, or filing treatment from the document that controls your case. In tax work, the safest result is the one supported by a challan, certificate, portal record, signed document, bank trail, or official notification.