RDA filer with Naya Pakistan Certificates: bank deducts 10% tax, but IRIS shows 15%. Do I need to pay extra 5%?

Question

I am overseas Pakistani and have an RDA account and have Naya Pakistan Certificates and a filer; hence, the applicable tax on profit will be 10% or 15%? Moreover, bank always deduct 10% however while filing yearly return, the FBR IRIS always calculate it 15%. Therefore, shall i have to pay the remaining 5% to FBR or i only have to pay 10% on the profit that has already deducted by the bank? Please advise

Answer 1

As an overseas Pakistani with an RDA account, profits on Naya Pakistan Certificates (NPCs) are subject to final tax at 10% if you are a filer, under Section 6 of the Income Tax Ordinance, 2001.

• The 10% withholding tax deducted by the bank is final, and no additional tax is payable.

• If IRIS shows 15%, it’s likely due to incorrect classification or manual input during return filing.

• You do not need to pay the extra 5%, but you must ensure the income is correctly declared under the “final tax regime” in your tax return.

Comments

Just a follow-up query - should this be filed under

"Payment to Non-resident u/s 152(2) for profit on debt / u/c (5A) @ 10%, Part II, 2nd Schedule - code 64050096  "

OR  

return on investment is not exceeding 1 million on sukukh u/s 5AA @ 10% u/s 151(1A), u/s 152(1DB)-  code 64030092.