Withholding review
Which of your payments require deduction, and under which section.
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As a withholding agent, your business is responsible for deducting tax on salaries, rent, supplies, services and payments to non-residents, depositing it on time and issuing certificates. We set up and run your withholding so the liability never lands on you.
Pakistan collects a large share of its income tax through withholding: businesses deduct tax from payments they make and deposit it with FBR. When a withholding agent fails to deduct or deposit, the law can recover the tax from the agent, with default surcharge on top.
Under the Income Tax Ordinance, 2001, withholding agents deduct tax on salaries under section 149, payments for supplies, services and contracts under section 153, rent under section 155, payments to non-residents under section 152, commission under section 233 and other payments the law specifies. The rate often depends on whether the recipient is on the Active Taxpayers List, so checking each payee's status matters. The tax is deposited within the prescribed time, a certificate is given to the payee under section 164, and the deductions are reported in quarterly statements under section 165.
Where tax is not deducted or not deposited, section 161 makes the withholding agent personally liable for it, and section 205 adds default surcharge, with penalties under section 182 for late statements. Our withholding tax compliance service handles the deductions; our withholding tax return filing service handles the statements, and our payroll services cover salary withholding in detail.
A fixed monthly fee based on the number of payments you make.
Which of your payments require deduction, and under which section.
Each payee's Active Taxpayers List status checked before payment.
Correct rates applied for each payment type and payee status.
Monthly tax on salaries under section 149 computed correctly.
Tax deposited with FBR within the prescribed time through PSID.
Deduction certificates issued to payees under section 164.
Deductions reported in section 165 statements.
Support if FBR audits your withholding under section 161.
These are the findings we see most often in withholding audits.
Payments made without deduction can be charged to you under section 161.
We review every payment type.Payees not on the Active Taxpayers List usually attract higher rates.
We check status before paying.Tax deducted but deposited late brings default surcharge under section 205.
We deposit on time.Payees need section 164 certificates to claim credit for tax you deducted.
We issue certificates.Quarterly section 165 statements are due even with no deductions.
We file every quarter.Payments to foreign persons have their own rules under section 152 and tax treaties.
We review cross-border payments.Share payment runs or ledgers monthly; we handle the rest.
We look at your payments, payees and past statements.
A monthly fee based on payment volume.
Payee list, rates and a withholding checklist created.
Deductions calculated, deposited and certificates issued.
Section 165 statements filed on time.
Withholding on suppliers, contractors, rent and staff.
Partnerships with withholding obligations on payments they make.
Businesses deducting tax from salaries.
Businesses deducting tax on rent paid.
Payments to non-residents and treaty relief.
High volumes of supplier and contract payments.
We connect your withholding, payroll, statements and return, so every deduction is supported and every credit agrees.
A clear checklist of which payments need deduction.
ACCA and ICAP Chartered Accountant qualifications and an FBR-registered income tax practitioner.
Payees' ATL status checked before rates are applied.
Records kept so a withholding audit has answers.
Salary withholding handled with your payroll.
A predictable monthly fee.
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Tell us roughly how many payments you make each month and to whom. We will review your obligations and quote a fixed fee.
Book your free consultationThis page is general information about our services, not tax, legal or financial advice for your specific situation. Laws, rates and deadlines change with each Finance Act and official notification.