Section 156 — Prizes & Winnings Withholding Tax
Section 156 prize WHT Pakistan TY 2025-26 — 15% filer / 30% non-filer final tax on prize bonds; 20% / 40% on raffles, quizzes, and lottery winnings deducted at source.
Section 156 taxes prize bond wins and lottery/raffle/quiz winnings as final tax at source. Prize bonds: 15% filer, 30% non-filer. Raffles, quizzes, and lottery: 20% filer, 40% non-filer. The State Bank or Central Directorate of National Savings deducts on prize bonds; the prize sponsor deducts on raffles and quizzes. The recipient receives the net amount.
Section 156 is final tax — you cannot offset losses, claim it as advance, or get a refund. The deduction is settled at the moment of payout. A non-filer winning PKR 1.5 million on a prize bond pays PKR 450,000 versus a filer's PKR 225,000 — making ATL maintenance one of the highest-ROI tax moves available to anyone holding prize bonds.
Although Section 156 is final tax, declare the win on your IRIS return under code 7033 (Final/Fixed Tax). A six- or seven-figure prize without a corresponding income declaration creates an unexplained-wealth gap on your wealth statement that FBR audits will eventually flag.
Frequently asked questions
What is the Section 156 rate on prize bonds?
15% for ATL filers / 30% for non-filers, deducted by the State Bank or CDNS before payout. Final tax — no offset, no refund.
Are raffle and quiz prizes taxed differently?
Yes — raffles, quizzes, and lotteries face the higher 20%/40% rate under Section 156, deducted by the prize sponsor.
Can I claim Section 156 back as advance tax?
No. Section 156 is final tax. Declare the prize on your IRIS return for wealth-statement reconciliation only.
Why is ATL status important for prize bonds?
Non-filers pay double — 30% instead of 15% on every prize. A single seven-figure win for a non-filer can cost more in tax than a decade of filing fees.