Eligibility review
Whether your income or payment qualifies under section 159.
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If your income is exempt, taxed at a lower rate or already covered by tax paid, you should not suffer full withholding on every payment. We apply for section 159 exemption and reduced-rate certificates on IRIS, support the claim with evidence and help you use the certificate with your payers.
Pakistan collects much of its income tax through deduction at source. When your income is exempt or taxed below the normal rate, full withholding locks up cash in refunds that can take a long time to recover. An exemption or reduced-rate certificate tells your payers to deduct less, or nothing at all.
Section 159 of the Income Tax Ordinance, 2001 allows the Commissioner to issue a certificate where a person's income or payment is exempt, chargeable at a lower rate, or eligible for a full tax credit. Withholding agents must deduct tax in full unless such a certificate is in force. The law also provides specific routes for profit on debt that is not likely to be taxable, for the sale of a residential property used personally for the required period, for investment funds and companies that distribute the required share of their income, and for organisations approved under section 2(36).
Applications are made through IRIS with supporting evidence, such as your return and tax profile, a projection of income and tax, details of exempt status or approval, and proof of tax already paid. For companies, the law requires the Commissioner to issue the certificate within 15 days, failing which it is treated as issued, although the Commissioner can later modify or cancel it after giving you a hearing. Certificates are usually limited to a period or a specific payer, so they need renewal and careful use.
If you are an exporter of IT services, separate rules may apply to tax on your export proceeds; see our IT export tax consultancy. Non-profits seeking approval first should speak to us about section 2(36) before applying for a certificate.
A fixed fee per application, agreed after we review eligibility.
Whether your income or payment qualifies under section 159.
Income and liability projected to support the rate requested.
Returns, approvals and proof of tax paid assembled.
Application prepared and filed online.
Queries from the Commissioner answered.
Deemed issuance tracked for company applications.
Certificate shared with payers with a cover letter.
New applications before certificates expire.
These are the issues we see most often.
Under section 159(2), payers must deduct in full without a valid certificate.
We obtain the certificate.A reduced rate needs a credible tax projection.
We build the numbers.Missing or late returns undermine any application.
We regularise filings first.Property and fund certificates have specific conditions in the law.
We check each condition.Payers revert to full withholding once a certificate lapses.
We renew in time.Over-withholding becomes a refund claim that can take a long time.
We prevent it upfront.Start before the payments you want covered.
We confirm which route under section 159 applies.
Agreed per application.
Projection and evidence pack assembled.
Application filed on IRIS and tracked.
Certificate sent to payers and renewal diarised.
Where full withholding exceeds the real liability.
Reduced deduction under section 153.
Rent and residential property sales.
Approved organisations under section 2(36).
Funds meeting the distribution condition.
Treaty-exempt income received in Pakistan.
We prepare the application as carefully as a return, so the Commissioner has what is needed to decide.
Projections and documents that support the claim.
ACCA and ICAP Chartered Accountant qualifications and an FBR-registered income tax practitioner.
LLB-qualified advocate for eligibility questions.
Certificates consistent with your filings.
No lapse between certificates.
Agreed before work starts.
Have a question that is not here? Send it to us on WhatsApp and we will reply the same day.
Tell us what payments you receive and how they are taxed. We will check whether a certificate is available 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.