How is capital gains tax on property worked out?
Section 37(1A) charges the gain on disposal of immovable property in Pakistan under the head Capital Gains at the rates in Division VIII of Part I of the First Schedule. The gain is the consideration received minus the cost of the property (section 37(2)). The rate then depends on when the property was acquired.
Property acquired on or before 30 June 2024
| Holding period | Open plot | Constructed property | Flat |
|---|---|---|---|
| Up to 1 year | 15% | 15% | 15% |
| Over 1, up to 2 years | 12.5% | 10% | 7.5% |
| Over 2, up to 3 years | 10% | 7.5% | 0% |
| Over 3, up to 4 years | 7.5% | 5% | 0% |
| Over 4, up to 5 years | 5% | 0% | 0% |
| Over 5, up to 6 years | 2.5% | 0% | 0% |
| Over 6 years | 0% | 0% | 0% |
The printed table shows a dash for constructed property after five years and for flats after three years, below a 0% row, so the calculator treats those periods as 0%.
Property acquired on or after 1 July 2024
15% of the gain for a person on the active taxpayers' list on the date of disposal. For a person not on the list, the rates in Division I for individuals and associations of persons, or Division II for companies, with a floor of 15%of the gain for individuals and AOPs. For that case the calculator applies the tax year 2027Division I table to the gain alone and takes the higher of that and 15%. The real figure depends on the person's total income, so treat it as a rough guide.
Where the rates come from
Every rate is read from the Income Tax Ordinance, 2001 as consolidated by FBR. The rates on this page were last checked against the official text on 2026-09-26.
- Income Tax Ordinance, 2001, section 37, capital gains, sub-sections (1A), (2) and (4) (as amended to 2026-06-30) official file
- Income Tax Ordinance, 2001, First Schedule, Part I, Division VIII, capital gains on immovable property (as amended to 2026-06-30) official file
- Income Tax Ordinance, 2001, First Schedule, Part I, Division I, clause (1), rates for individuals and AOPs (as amended to 2026-06-30) official file
- Income Tax Ordinance, 2001, section 236C, advance tax on sale, adjustable (as amended to 2026-06-30) official file
Common questions
What is the capital gains tax on property bought after 1 July 2024?
15% of the gain for a person on the active taxpayers' list on the date of disposal, whatever the holding period. A person not on the list is taxed at the Division I rates for individuals and AOPs, or Division II for companies, and an individual or AOP pays not less than 15% of the gain.
What about property bought on or before 30 June 2024?
The old holding period table still applies. An open plot pays 15% if held up to one year, falling to 0% after six years. Constructed property reaches 0% after four years, and a flat after two years.
How is the gain on a property worked out?
Section 37(2) computes the gain as A minus B, where A is the consideration received on disposal and B is the cost of the asset. Section 37(4) says the cost does not include expenditure that is or may be deducted under another provision of the chapter, or that is referred to in section 21.
Does the seller also pay advance tax under section 236C?
Yes, advance tax is collected from the seller at registration under section 236C, separately from capital gains tax. Section 236C(2) makes it adjustable, so it can be set against the tax due for the year, including tax on the gain.