Wednesday, 30 November 2022

No more withholding tax on educational fees

Federal Board of Revenue (FBR) revised withholding tax rate on educational fee. Applicable from the tax year 2021.

Tax card uploaded by FBR revised up to 30th June 2020 though Finance Act 2020.

FBR revised Section 236I of Income Tax Ordinance, 2001. Educational institute shall collect withholding tax / advance tax while preparation of fee challan. Such advance tax shall be payable by the students’s parents or guardian at the time of payment of fees. Tax paid under this section is adjustable tax for the parents or guardian against payable tax liability.

Fee includes tuition fee & all charges received by the educational institution. Excluding the amount which is refundable. Such withholding tax / advance tax is applicable only if fees is exceeding Rs. 200,000 per annum. This tax is not applicable on scholarship amounts. Tax rate is at the rate of 5% (Five percent). Only from the students, parents or guardians whose names are not appearing in the Active Taxpayers List (ATL) of the FBR.



Now the persons filing income tax returns and are on the active taxpayers’ list (ATL). Are no more require to pay withholding tax / advance tax at the time of paying educational fee.



-Withholding Tax Rates Updated Up to 30th June 2020 (Click to Download)

-Documents Required For Submission Of Annual Income Tax Returns

-Finance Act 2020 | FBR Budget Salient Features | Tax Year 2021 |

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