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s. 5

Tax on dividends

Charge Of Tax

(1) Subject to this Ordinance, a tax shall be imposed, at the rate specified in Division III of Part I of the First Schedule, on every person who receives a dividend from a company or treated as dividend under clause (19) of section 2 .
(2) The tax imposed under sub-section (1) on a person who receives a dividend shall be computed by applying the relevant rate of tax to the gross amount of the dividend.
(3) This section shall not apply to a dividend that is exempt from tax under this Ordinance.
Amendment history (8)
  • The words “and Seventh” substituted by the Finance Act, 2023.
  • The sub-section (5A) inserted by the Finance Act, 2023.
  • The word “resident” omitted by the Finance Act, 2003.
  • Inserted by the Finance Act, 2009.
  • section 5A substituted by the Finance Act, 2017. The substituted section
  • The word “seven and half” substituted by the Finance Act, 2018
  • The word “forty” substituted by the Finance Act, 2018
  • The word “or bonus shares” omitted by the Finance Act, 2018

Amendment notes captured from the source page(s); they may include changes to neighbouring provisions.

Source FBR PDF page 36

Unofficial reference, compiled from the FBR’s consolidated Income Tax Ordinance 2001 (amended up to 30 June 2026). Provided for general information only — not an official FBR publication and not legal or tax advice. Always verify against the official FBR text before relying on it for filing or any decision.