The government of Pakistan had announced to allow its citizens to repatriate their assets held in different countries under the Asset Declaration Scheme Ordinance 2019. Now, the detailed procedure for the same has been unveiled.
It means that taxpayers can white their money parked outside the country in the form of immovable properties and other liquid assets such as cash and gold etc. However, the condition is to bring back the amount to the home country and keep their liquid assets or cash in Pakistani banks.
Repatriation of Assets to Pakistan
In this regard, the central bank stated rules and procedure for overseas Pakistanis and Pakistanis with wealth held in different countries.
Taxpayers intending to repatriate their assets held outside Pakistan shall remit the same to Pakistan through banking channels in declarants’ own account, whether denominated in PKR of FCY in any bank in Pakistan.
Taxpayers may also repatriate their liquid assets by subscribing to Pakistan Banao Certificates (PBCs) digitally through the web portal at PakistanBanaoCertificates.gov.pk.
The Pakistani bank receiving the repatriated funds shall issue Asset Repatriation Certificate (ARC) which shall include the details such as Name of Remitter, Amount in FCY, and IBAN of the taxpayer. Each ARC shall have a unique reference number, which the taxpayer shall use to report the same to FBR. The taxpayer shall also upload the ARC on the FBR Web-Portal.
The asset held outside Pakistan and foreign currency held in Pakistan shall be converted into PKR at such exchange rates as may be notified on a daily basis by the SBP to Federal Board of Revenue (FBR) through dedicated email in respect of ten currencies i.e. AED, AUD, CAD, CHF, CNY, EUR, GBP, JPY, SAR, and USD.
Those citizens who don’t want to repatriate their assets will have to pay a 6 percent tax of the overall value of their wealth.
The taxpayer shall declare the value of his/her assets held outside Pakistan on the FBR Web Portal in respective foreign currency and equivalent PKR computed as per the procedure given in clause 3.
The system will generate tax liability of the taxpayer in PKR by applying the relevant tax rate for each category of disclosed assets.
The taxpayer has the option of discharging his/her liability either in USD or AED. After the selection of tax payment currency, the system will compute the tax liability in both PKR and USD/AED. The sequential number of PSID (PSID Number) will be recorded by the taxpayer in his/her own record.
Further steps of repatriation of tax under the scheme can be viewed here.