Withholding Tax in Pakistan: Rate Card & How to Stay Compliant

If you have read our explainer on what withholding tax is, this guide is the practical companion: how the rates actually work and how to stay compliant without drowning in spreadsheets.

Why there is no single WHT rate

Withholding tax in Pakistan is not one number. The rate depends on two things: what the payment is for, and whether the recipient is a filer. A payment for services is treated differently from a payment for goods; a payment to a filer is treated very differently from a payment to a non-filer.

1. The type of payment

Goods, services, contracts, rent, commission, dividends, and profit on debt each sit under their own withholding head with its own rate. Matching a payment to the correct head is the single most important step — and the most common place businesses get it wrong.

2. Filer vs non-filer status

For almost every head, non-filers pay a higher — sometimes double — withholding rate. Checking the Active Taxpayers List before you pay can materially change the amount you must withhold.

Common withholding heads at a glance

• Supply of goods — withheld by the buyer at payment
• Services — typically a higher rate than goods
• Contracts and execution of works
• Rent of immovable property
• Commission and brokerage
• Profit on debt and certain bank transactions

Depositing on time

Deducting is only half the job — the tax must be deposited with FBR and reported in your withholding statements on time. Late deposit invites penalties and default surcharge. Software that records the head, rate, and filer status at the moment of payment turns this into a routine task. Combine it with real-time FBR digital invoicing and your entire tax footprint stays consistent and audit-ready.