Section 150 — Dividend Withholding Tax in Pakistan
Section 150 dividend WHT Pakistan TY 2025-26 — 15% filer / 30% non-filer final tax, IPP, REIT, mutual fund rates, and IRIS declaration tips.
Section 150 governs withholding on dividend payments by Pakistani companies and mutual funds. The standard rate is 15% for filers on the Active Taxpayer List and 30% for non-filers. The tax is final — you cannot offset capital losses against it and you cannot adjust it against your slab liability. The registrar or CDC deducts at source before crediting your account.
Special categories diverge from the standard rate. IPP (independent power producer) dividends are taxed at 7.5% (filer) / 15% (non-filer). REIT (Real Estate Investment Trust) distributions face the higher 25% / 50% bracket. Mutual fund dividend distributions follow the standard 15% / 30%, but capital gains on redemption are separate under the Eighth Schedule.
Although Section 150 is final tax, you must still declare dividend income on your IRIS return — for transparency and wealth-statement reconciliation. Domestic dividends go under IRIS code 5006; foreign dividends are taxed at normal slab rates as part of total income, with DTAA credit for any foreign tax already withheld at source.
Frequently asked questions
What is the Section 150 dividend tax rate?
15% for filers (ATL) and 30% for non-filers, deducted at source by the company or CDC. It is final tax — closed at the moment of declaration.
Do I have to declare dividends if they're final tax?
Yes. Declaration is required for transparency and wealth-statement reconciliation. The tax is final but the income still appears on your IRIS return.
Are mutual fund dividends covered by Section 150?
Standard mutual fund dividend distributions: yes, 15%/30%. Capital gains on redemption are a separate Eighth Schedule regime with category-dependent rates.
What's the rate on REIT dividends?
25% (filer) / 50% (non-filer) under Section 150 — higher than standard dividends because the underlying property income hasn't been taxed at REIT level.