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Navigating Section 236Y: A Quick Guide to Advance Tax on Foreign Card Payments

Paying for an international subscription, software, or online service with your debit/credit card? If you're in Pakistan, your bank might deduct an advance tax at the time of payment.

What is Section 236Y?
It’s a withholding tax provision designed to collect advance income tax when you use a Pakistani debit, credit, or prepaid card to pay a foreign merchant or for a foreign service.

Here’s a clear breakdown of Section 236Y of the Income Tax Ordinance, 2001, and what it means for you.