Collection of advance tax on purchase of property to be made along with each installment in instances where payments for purchase of property is made piecemeal [Section 236K]
Collection of advance tax on purchase of property: Prior to the Finance Act, 2018 advance tax on purchase of immovable property under section 236K of the Income Tax Ordinance, 2001 was collected at the time of registering, recording or attesting transfer of any immovable property.
In instances where payments for purchase of property are being made in installments the purchaser has to bear the entire burden of collection of such advance tax at the time of transfer of the immovable property.
In order to provide relief to purchasers of immovable property making payments in installments, advance tax under section 236K of the Ordinance on the purchase of immovable property shall, pursuant to the Finance Act, 2018 be collected at the time of collecting installments @ 2% for filers and 4% for non-filers (where the value of immovable property exceeds Rs.4 Million) along with each installment where the transfer is to be effected after making payment of all installments of immovable property.
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