Sole Proprietor / Personal Income Tax
CBM Consultants supports sole proprietors in Pakistan with complete tax compliance, including income tax and sales tax return filing and FBR scrutiny handling. We also ensure accurate bookkeeping and professionally prepared financial statements, enabling better financial control, transparency, and smooth audits.
What does “Sole Proprietors” refer to?
A sole proprietorship is a simple and common business structure where one individual owns and operates the business. The owner has full control and receives all profits but is also personally responsible for debts, taxes, and legal obligations. This structure is widely used by freelancers, consultants, and small business owners in Pakistan.
Personal Income Tax Services
Salaried Individuals:
We assist employees in navigating the latest tax slabs (2025–26) and optimizing their take-home pay.
Accurate calculation of tax based on gross salary and taxable allowances.
Advice on tax-efficient salary components, medical allowances, and provident fund contributions.
Ensuring credits for Zakat, donations to approved NPOs, and educational expenses.
Reconciling tax already deducted at source (Section 149) with your final return to avoid overpayment.
Freelancers & IT Professionals
We offer specialized packages for the digital economy, focusing on the reduced tax regimes for exporters.
Handling the end-to-end process with the Pakistan Software Export Board to qualify for the 0.25% reduced tax rate on foreign remittances.
Documentation of inward remittances to ensure they are treated under the correct tax codes (Section 154A).
Applying for and obtaining exemption certificates via Iris to prevent unnecessary withholding by banks.
Purchase of Immovable Property (Section 236K)
Buying property now involves a multi-tier tax structure based on the property value and your filer status.
We guide you through the 1.5% to 2.5% advance tax rates for Filers (saving you from the massive 10.5% to 18.5% rates applied to non-filers).
We help you document the “White Money” used for the purchase to ensure it matches your previously filed Wealth Statements.
Special assistance for NICOP/POC holders to avail “Filer Rates” even if they are non-resident, through the specialized FBR portal process.
Deemed Income on Property (Section 7E)
Even if your property is vacant, it may be subject to tax under Section 7E.
We determine if your properties fall under the 1% tax on “Deemed Income” (generally for properties valued above Rs. 25 million).
We handle the legal filing for exemptions, such as for your primary residence, farmhouse, or agricultural land.
Obtaining the necessary Form “A” or 7E clearance required by housing societies (like DHA, Bahria, or Naval Anchorage) and registrars for property transfers.
Compliance & Dispute Resolution
Ensuring your name stays on the ATL so you enjoy lower withholding rates on banking and property transactions.
Professional representation if you receive a notice under Section 122 (Amendment of Assessment) or Section 176 (Information Seeking).
Calculating and managing quarterly tax payments for high-income individuals.
Sole Proprietors & Self-Employed
For individuals running their own businesses, we provide a complete financial and compliance support system.
Adding your business name and activity to your tax profile (Form 181).
Assistance in maintaining proper books of accounts, ledgers, and expense documentation required for FBR audits.
Identifying all legally deductible business expenses (rent, utilities, marketing, and professional fees) to reduce taxable profit.
If your turnover exceeds the threshold, we manage your STRN registration and monthly sales tax filings alongside your income tax.
Wealth Statement & Assets Reconciliation
A critical part of the Pakistani tax return is the Wealth Statement (Section 116). We ensure total transparency between your income and your lifestyle.
Precise compilation of all personal assets (property, vehicles, jewelry) and liabilities (loans).
Matching your increase/decrease in wealth with your declared income and personal expenses to prevent FBR “unexplained income” notices.
- Legal documentation and tax advisory for assets received as gifts or through inheritance.
Property Rental Income (Section 15 & 155)
Managing rental income requires careful reporting to avoid heavy withholding by tenants and potential FBR audits.
We calculate your tax based on the latest 2025–26 slabs for individuals.
We ensure you are registered as a Filer to benefit from reduced WHT rates (e.g., 0% to 25% for filers vs. up to 50% for non-filers on high rental brackets).
We advise on the new “4% Fair Market Value” rule to ensure your declared rent meets FBR’s minimum valuation standards for commercial properties.
For individuals, we help you claim relevant deductions to arrive at your “Chargeable Rent.”
Sale of Immovable Property (Section 236C & Capital Gains)
Selling property involves both a transaction-based advance tax and a profit-based Capital Gains Tax (CGT).
Management of the 4.5% to 5.5% advance tax collected at the time of transfer.
New Rules: For properties acquired after July 1, 2024, a flat 15% CGT applies to the profit.
Grandfathered Assets: For properties bought before June 30, 2024, we calculate the tapering tax rate (which reduces to 0% after a 6-year holding period).
Guidance on the “once-in-15-years” exemption for personal residences held for over 15 years.
Agricultural Income Tax Services
Federal Reporting & Exemption (FBR)
Even though agricultural income is not taxed by the FBR, it must be declared correctly in your annual return to justify your lifestyle and asset growth.
We ensure your agricultural earnings are declared under the correct “Exempt” head to legally justify your wealth.
We use your documented agricultural income to explain the source of funds for new investments (property, vehicles, or business capital), preventing “unexplained wealth” notices from the FBR.
We organize your financial trail (mandi receipts, lease agreements, and bank statements) so your declared income can withstand FBR scrutiny during an audit.
Special Tax Regimes for 2026
For large-scale or corporate agricultural ventures, we manage the transition to corporate tax rates as per the latest Finance Act.
We handle the necessary filings to ensure your Self-Owned Agricultural Land is exempted from the 1% “Deemed Income Tax” (Section 7E), which otherwise applies to non-productive immovable property.
Provincial Tax Filing & Payments
Agricultural income is taxable at the Provincial level (Punjab, Sindh, KPK, and Balochistan). We handle the complete calculation and payment process:
We calculate your liability based on the latest 2025–26 provincial slabs, choosing the most efficient method (whether Acreage-based or Income-based) allowed by your province.
We generate and process your tax payments for the Punjab Revenue Authority (PRA), Sindh Revenue Board (SRB), or other provincial bodies
We verify if your landholding falls below the taxable threshold (e.g., the 12.5-acre exemption in Punjab) and ensure you are not paying unnecessary taxes.
Income from Land Leases (Theka)
If you lease your land rather than cultivate it yourself, the tax treatment changes significantly.
We ensure rental income from agricultural land is classified correctly under provincial rules to prevent it from being taxed at the much higher Federal “Income from Property” rates.
We advise on the tax implications of receiving lease payments and ensure all provincial tax obligations are met to keep you compliant.