Clarification on Exempt Income Received from Hunza (GB Region)

Question

I am a salaried individual based in Lahore. My employer deducts income tax at source and provides the relevant tax certificate, so that part is sorted and I file my tax return accordingly.  However, I am originally from Hunza Valley, Gilgit-Baltistan. Since GB is not considered part of mainland Pakistan in terms of taxation, there is no formal income tax regime applicable there. My family owns agricultural land in Hunza, and they earn income through farming, fruit orchards, and timber. Recently, they deposited PKR 2 million into my personal bank account as financial support towards the purchase of a vehicle. A portion of this amount was also from my own savings.  I want to confirm:  Since this PKR 2 million originated from agriculture and family support from Gilgit-Baltistan, is it exempt from taxation under Pakistani tax law?  How should I report this in my tax return to remain compliant and avoid any audit concerns?  Also, I’d like to know:  What are your service charges for filing tax returns?  Where is your team based? I’m interested in filing my return through your team this year.  Thank you for your guidance.

Answer 1

Agricultural Income: Under the Income Tax Ordinance, 2001, agricultural income is exempt from federal income tax and falls under provincial jurisdiction.
Since Gilgit-Baltistan (GB) is not covered by Pakistan’s federal income tax regime, its agricultural income is not taxed under FBR rules.

Family Support: Funds received as a gift or family support from relatives (blood relations such as parents, siblings, children, etc.) are exempt from tax under, provided they are properly documented.

Source: Your family’s farming, orchards, and timber income in GB is exempt from Pakistan’s federal income tax and, if given to you as a gift, will not be treated as taxable income.

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Our Service Charges & Location

• Tax Return Filing Charges: Our charges are PKR 3,000 for salaried individuals, with one week free support. (Celebrate Azadi with Savings! Use code AZADI14 at checkout to get 14% OFF on all tax filing and consultancy services till August 14)

• Location: Our team is based in Swabi and Islamabad with virtual service available all over Pakistan, including Lahore and GB.

We handle everything online — you’ll just need to share your salary certificate, bank statement, and the gift/agricultural income proof, and we’ll prepare and file your return.