Islamabad, Dec 26: The Punjab government has mandated the recovery of a 5 percent penalty on immovable property purchases made through non-banking transactions within the province, in line with the Income Tax Ordinance 2001. This move comes as part of efforts to ensure compliance with tax regulations and curb non-banking property deals that bypass formal financial systems.
The Board of Revenue of Punjab has issued a letter addressing key officials, including the Registrar Cooperative Societies, Director General of the Punjab Land Records Authority, District Registrars, and Deputy Commissioners. The letter specifies that under Section 75A of the Income Tax Ordinance, 2001, and Entry No. 21 of Chapter X, a penalty rate of 5 percent is applicable on the purchase of immovable property where the fair market value exceeds five million rupees, or on any other assets exceeding one million rupees.
The Board of Revenue’s directive follows concerns raised during a pre-PAC (Public Accounts Committee) meeting, chaired by a senior member of the Board, where it was noted that sub-registrars, assistant directors of Land Records, and transferring officers had failed to collect the penalty on non-banking property transactions. This oversight led to dissatisfaction among the concerned authorities, who have now ordered the circulation of clear instructions to ensure that the penalty is collected appropriately.
The letter stresses that all relevant officers working under respective jurisdictions must comply with this directive. Failure to collect the penalty will make the concerned transferring or attesting officer liable for any non-compliance. This enforcement is expected to improve tax collection and encourage adherence to formal financial procedures in property transactions across Punjab.
