The Federal Board of Revenue (FBR) has intensified monitoring of financial transactions, including credit card usage, as part of ongoing efforts to expand Pakistan’s tax base and improve documentation of the economy. Credit card users should be aware that banks are legally required to report transactions exceeding specific payment thresholds to tax authorities.
Under Rule 39A of the Income Tax Rules, 2002 — amended up to November 24, 2023 — banks must report monthly credit card payments of Rs200,000 or more to the FBR. Once this limit is crossed, financial institutions are obligated to share detailed information about the cardholder with the tax authority.
The information shared includes CNIC, NICOP, or passport number, NTN (where applicable), name of the account holder, residential status, address, contact details, credit card issuance date, declared business or profession, and the total amount paid against credit card bills during the reporting period.
Rule 39A also specifies multiple reporting requirements for banks, including submission of account holder deposit statements, credit card payment details, cash withdrawal records, and profit-on-debt information through prescribed reporting formats. Designated banking officers are responsible for coordinating with the FBR and ensuring timely submission of financial data.
According to reporting timelines, banks must submit monthly credit card payment statements within 15 days following the end of each month, while annual profit-on-debt statements are required within three months after the close of the financial year. Any additional information demanded by the FBR must also be provided within the stipulated timeframe.
Tax experts advise that individuals making monthly credit card payments above Rs200,000 should ensure their declared income and tax profile accurately reflect their spending patterns, as such transactions automatically fall within the FBR’s data monitoring system aimed at enhancing transparency and tax compliance across Pakistan.
