DC Islamabad Gives 1-Week Deadline to Housing Societies to Pay Stamp Duty and Other Taxes

Housing Societies

The district administration of Islamabad has issued a directive to housing societies, requiring them to provide detailed information on stamp duty and other government taxes, including advance tax, gain tax, and 7E taxes, within one week.

Sources informed ProPakistani that the Deputy Commissioner (DC) of Islamabad has sent a letter to all housing societies regarding the non-recovery of these taxes. A review of recent transactions and interactions revealed that many housing societies have not been charging or remitting the necessary stamp duty and government taxes related to property transactions.

According to applicable laws, stamp duty must be paid upon the execution of sale deeds, lease agreements, and other property-related documents. This duty is essential as it validates the legal status of these documents, ensuring they are admissible in court.

Additionally, other taxes such as property tax and maintenance-related levies must be correctly charged and remitted to government authorities. These obligations are mandatory by law, and non-compliance can result in significant legal and financial consequences for both the societies and their members.

The government has imposed a 4 percent duty tax on both filers and non-filers. The registration fee is 1 percent for both filers and non-filers, with an advance tax of 3 percent for filers and 10 percent for non-filers. Furthermore, there is a gain tax of 3 percent for filers and 6 percent for non-filers, along with a 1 percent 7E tax for both groups.

“You are therefore directed to provide a detailed report of property transactions/transfers conducted since the inception/regularization of societies,” the DC Islamabad stated in the letter.

The report must include every transaction along with the supporting bank challans through which the taxes were deposited into the government exchequer. The detailed report should be submitted to the DC office within a week to avoid any adverse legal consequences as per the law.