Property advance tax: 236C and 236K
The advance tax deducted at the registry is a credit against your tax, not a fee you have paid and lost. Most people never claim it because they never file.
You bought or sold property this year, tax was deducted at the time of registration, and nobody explained whether you get it back.
What you get for Priced as your return
- Advance tax under section 236K on purchase and 236C on sale identified
- Your filer position at the transaction date confirmed against the ATL
- The deduction claimed as a credit in your return rather than written off
- Capital gain on disposal computed against the applicable holding period
- Rental income brought in under the correct head, where you let the property
What we need from you
- Sale deed or purchase deed for the transaction
- Challan or receipt for the advance tax deducted at registration
- Date of original acquisition, for a disposal
- Rental agreement and agent statements, if the property is let
- Your CNIC and, if you have one, NTN
How it runs
- 01Send the deed and the challan
Those two documents tell us what was deducted and whether it was at the filer or non-filer rate.
- 02We compute the position
Gain, holding period and the advance tax credit, worked through against the enacted rates.
- 03Claimed in your return
The credit is set against your liability. Where it exceeds the liability, a refund position arises.
- 04Filed and acknowledged
Filed on IRIS with the acknowledgement returned to you.
Questions people actually ask
Is the advance tax at registration refundable?
It is adjustable, which in practice means it is claimed as a credit against the tax you owe for the year, and produces a refund position only where the credit exceeds the liability. What it is not is a transaction fee. The catch is that the credit can only be claimed through a filed return — the money is simply lost if you never file.
Why was I charged so much more than my neighbour?
Almost always because one of you was on the Active Taxpayer List at the transaction date and the other was not. Advance tax on property is charged at a materially higher rate for persons not appearing on the ATL, and the position is tested at the date of the transaction — not the date you later decide to file. On a sizeable transaction the difference is measured in hundreds of thousands of rupees.
I am selling. What decides the tax on the gain?
The holding period is the main driver — the rate applicable to a disposal steps down the longer the property has been held, and the acquisition date therefore matters as much as the sale price. Being able to evidence the original acquisition date and cost is what makes the computation defensible.
I bought property but I have no other income. Do I still file?
Yes, and you probably must. Acquiring immovable property above the prescribed value is itself a trigger for the filing requirement, independent of whether you have taxable income. It also raises the question the wealth statement exists to answer — where the funds came from. Buying property while off the register is one of the clearer ways to attract a notice.
Read this before you engage us
If the answer is in one of these, you may not need us — and we would rather you found that out for free.
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