Withholding tax on banking transaction

Does anybody know what is the limit after which banks deduct withholding tax on cash transactions?

I know the rate is 0.3% but I am talking about the amount after which this rate applies. For e.g. we can do cash transactions up to Rs. 40000 and after that 0.3% applies. So I am looking for that limit.

Rs. 50,000 per day
0.3% for filers
0.6% for non-filers

[quote=“mysterio92, post:2, topic:22605”]

Rs. 50,000 per day
0.3% for filers
0.6% for non-filers

[/quote]

I transferred 140000 to another account (different bank) using online banking and they deducted Rs. 420 which is exactly 0.3%.

But transaction description says “NON FILER TAX DEDUCTION AS PER FINANCE BILL 2015”

If I am not mistaken, there is no deduction on any amount

if a person has an active tax NTN number. For non-filers

there is a 0.3% WHT (reduced from earlier figure of 0.6%).

But according to this, WHT only applies when you take out

cash. There is no WHT on IBFT (inter-bank fund transfers).

So I don't know why they charged you Rs. 420, a figure which

itself indicates something fishy. Could it be a service fee ?.

Sheikh 'Swimming With Sharks' Chilli

No the service fee is Rs. 58 (50 + 8 tax)

Yeah it should have been on cash withdrawal but looks like they also treat online bank transfer as cash withdrawal!?

Well according to this, Standard Chartered (as well as

most other banks) consider online bank transfers as

IBFT.

March down to the bank and demand an explanation.

Threaten to report the matter to the Ombudsmen of the

State Bank, if they don't return your money. That will

get them shaking like a leaf (believe it or not).

Sheikh 'Big Stick' Chilli

I have sent them an email requiring clarification and also mentioned if satisfactory reply is not received in due time, I will report the matter to State Bank Ombudsman.

WHT is only applicable on cash withdrawals above 50K per day (regardless of mode or number of transactions). Currently, it is applicable at 0.3% for both filers and non-filers. It is 0.6% for non-filers normally.

All IBFT/PRISM/cashless transactions are exempt from WHT since the money stays inside the banking system. Banks typically use the ATP list from FBR to distinguish filers from non-filers. As such, there is definitely no reason for the additional charge to you unless stipulated by the Bank SoC (schedule of charges) document so you should have a look at that too. Any charges by bank get bumped further up in value due to FED (15-16%) applicable on bank charges.

I think on banking transactions for filers its 0% and for non filers its 0.4%

Got this reply from bank.

We would like to inform you that as per our records, 0.3% withholding tax have been correctly charged against the transaction of Rs.140,000/- dated January 22, 2016.
Please be informed that on transfer transactions of more than Rs.50,000/-, withholding tax of 0.3% is applicable.

From March 1st. WHT for non-filers is 0.4% for total withdrawals if exceeding Rs 50,000.00 per day whether by cash or by cheque/funds transfer.