Remittance

Hi all

I am a salaried person having NTN number, i have to file return yearly.

my question is that my brother from abroad wants to send some remittance (PK rupees) to me. Can I use my bank's PLS saving Pak rupees account for this purpose.

Thanks

You should be able to but confirm with your account bank branch.

Will there be any issue with incometax

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Withholding tax, IIRC. Check with your bank and FBR website.

You'll need to declare it in the bank as why are you receiving these funds etc. There is form that they give you on the spot to fill out.

Since this isn't your income, in tax return, you have to put these in "Contribution from Family Members".

[quote=“mateen.khalid, post:5, topic:22482”]

You’ll need to declare it in the bank as why are you receiving these funds etc. There is form that they give you on the spot to fill out.

Since this isn’t your income, in tax return, you have to put these in “Contribution from Family Members”.

[/quote]

I don’t think ‘Foreign Remittance’ should be included in ‘Contribution from Family Members’! Foreign Remittance is exempt from Income Tax and it will only be exempt if you put it in Foreign Remittance.

[quote=“Asad, post:2, topic:22482”]

You should be able to but confirm with your account bank branch.

[/quote]

Asad, any idea what they mean by ‘Encashment Certificate’ from Bank to verify a foreign remittance to FBR? The bank only gave me a simple print out saying such and such reference no. payment of this amount is foreign remittance in the client’s such and such account no.

[quote=“Joker, post:7, topic:22482”]

Asad, any idea what they mean by ‘Encashment Certificate’ from Bank to verify a foreign remittance to FBR? The bank only gave me a simple print out saying such and such reference no. payment of this amount is foreign remittance in the client’s such and such account no.

[/quote]

No idea. Send an email to FBR about what particular data is required in that certificate and check against the document the bank gave you.

just spoke with my lawyer. he said just put the amount in return in foriegn remittace thats all. if u want to go on safer side then also get encashment certificate of each transaction.

[quote=“khuram89, post:9, topic:22482”]

just spoke with my lawyer. he said just put the amount in return in foriegn remittace thats all. if u want to go on safer side then also get encashment certificate of each transaction.

[/quote]

This ‘Encashment Certificate’, can you further ask the format of this because no one in the Bank understands this and I got only a letter like I mentioned above.

I think encashment certificate is for the people who gets remittance in foreign currency in the foreign currency account. when you encash or withdraw, the bank gives you encashment certificate at which rate the currency is exchanged. am i right or wrong plz correct me.

as my brother will send through UBL tezraftar (already converted to PKR) into my PKR A/C so i think i don't need encashment certificate.

plz shed some light??

[quote=“khuram89, post:11, topic:22482”]

I think encashment certificate is for the people who gets remittance in foreign currency in the foreign currency account. when you encash or withdraw, the bank gives you encashment certificate at which rate the currency is exchanged. am i right or wrong plz correct me.

as my brother will send through UBL tezraftar (already converted to PKR) into my PKR A/C so i think i don’t need encashment certificate.

plz shed some light??

[/quote]

No idea and this point has me confused TBH. What you are saying would make sense except those with Foreign Currency Accounts never convert their cash to PKR in Banks… I had written to FBR but no response yet.

I have no idea of this ...

Salam,

If my brother has a US-dollar account in pakistan and i send dollars into his account and he withdraws and converts not from the bank but from the money changer then can I use this for my tax purposes. In other words bank will not be giving an encashment certificate as conversion is not done at the bank.

Is this way still good for tax purposes? As this will be a gift to him and I want FBR to be satisfied with it and thus he can use these funds to buy real estate plots or invest in some business.

Please reply

All remittances to Pakistan come via State Bank and then come to your bank. All you need is to tell your brother to mention the purpose of the payment. Once the payment comes to your account; tell your bank to issue you a Proceeds Realization Certificate or PRC (its a document that basically says that the bank has received funds from so and so, the amount, purpose, dates etc AND says that the transaction was reported to State Bank). The first time, you’ll need to submit a written request, afterwards they will most likely get you the PRC when you authorise them over email.

At the end of the year, you declare the full collective amount received over the year into your income tax statement.

Also, if your brother wants to save money on transfers, tell him to use transferwise. You can take a look at the article here: https://tech-vise.com/transferwise-best-international-money-transfer-service/

Ive been using the service for over a year now. Its very fast and the transaction will come directly into your PKR account. The service can be used for personal payments only.