Property investors in Rawalpindi tracked the 2026 budget for one number: the seller’s advance tax under Section 236C. Early proposals floated slashing the filer rate to a single, low 1.5% — a headline that had 5-marla flippers celebrating. When the Finance Act 2026 was actually gazetted for tax year 2026-27, the government did something subtler: it scrapped the value slabs and set a flat 2.75% for filers instead. On paper that is still a cut. In practice, it quietly redistributes who benefits — and it does not reward everyone equally.
This guide recomputes the real sell-side and buy-side transfer cost on a typical 5-marla Silver City plot, then shows mathematically why a flat rate hands a bigger discount to large sellers than to small ones.
What actually changed under the Finance Act 2026
Until tax year 2025-26, both 236C (paid by the seller) and 236K (paid by the buyer) were charged on a three-tier slab tied to the property’s value. From 1 July 2026, filers pay a single flat rate regardless of value; non-filers still face far steeper flat rates (roughly 10–11.5%, so ATL status matters more than ever). Here is the shift for a filer seller:
| 236C slab (filer) | Old rate (2025-26) | New flat rate (2026-27) | Change |
|---|---|---|---|
| Up to Rs 50 million | 4.5% | 2.75% | −1.75 pts |
| Rs 50m – 100m | 5.0% | 2.75% | −2.25 pts |
| Above Rs 100 million | 5.5% | 2.75% | −2.75 pts |
Notice the pattern before we even touch a plot: the higher the slab, the deeper the percentage-point cut. A small seller’s rate drops 1.75 points; a top-slab seller’s rate drops 2.75 points. The flat rate is not neutral — it is structurally tilted toward high-value transactions.
The 5-marla Silver City worked example
A 5-marla residential plot in Silver City on Main Girja Road (near the Thalian Interchange) trades in the region of Rs 2.5 million on current pricing. Advance tax is charged on the higher of the FBR-notified value or the declared consideration, so confirm your plot’s notified value before signing — but Rs 2.5m is a fair working figure for a filer-to-filer transfer well inside the bottom slab.
| Cost on Rs 2,500,000 plot | Old (2025-26) | New (2026-27) | Difference |
|---|---|---|---|
| 236C — seller pays | Rs 112,500 (4.5%) | Rs 68,750 (2.75%) | −Rs 43,750 |
| 236K — buyer pays | Rs 37,500 (1.5%) | Rs 68,750 (2.75%) | +Rs 31,250 |
| Combined round-trip | Rs 150,000 | Rs 137,500 | −Rs 12,500 |
Two things jump out. First, the seller genuinely saves Rs 43,750 on this small plot. Second — and this is the part the “tax cut” headlines skipped — the small buyer now pays Rs 31,250 more. The old 236K bottom slab for filers was just 1.5%; flattening everything to 2.75% almost doubled the entry cost for anyone buying a modest plot. The combined saving of Rs 12,500 is real but thin, and it lands entirely on the seller’s side of the table.
Why the flat rate rewards big sellers more than small ones
Now compare our 5-marla filer to a filer offloading a Rs 200 million commercial or farmhouse plot (top slab). Look at the 236C relief each one banks:
| Filer seller | Plot value | Old 236C | New 236C | Saving | Rate cut |
|---|---|---|---|---|---|
| Small (5-marla) | Rs 2,500,000 | Rs 112,500 | Rs 68,750 | Rs 43,750 | 1.75 pts |
| Large | Rs 200,000,000 | Rs 11,000,000 | Rs 5,500,000 | Rs 5,500,000 | 2.75 pts |
The big plot is 80 times the value of the 5-marla, yet its owner’s tax relief is roughly 126 times larger (Rs 5.5m vs Rs 43,750). That is not a rounding quirk — it is the design. Because the top slab was cut by a full 2.75 points while the bottom slab was cut by only 1.75, the relief scales faster than the property value. A flat rate replacing a mildly progressive slab always shifts the benefit upward: the more expensive the asset, the deeper the discount, both in percentage points and in raw rupees.
The proposal to fix 236C at 1.5% would have flipped that story. On our 5-marla plot, a 1.5% seller rate meant just Rs 37,500 — so the enacted 2.75% costs the small filer Rs 31,250 more than promised. Small sellers lost the most when the number moved from proposal to law; large sellers barely cared, because even 2.75% was already a windfall against their old 5.5%.
Practical takeaways for Silver City investors
- Stay on the ATL. Filer status must be active on the transfer date. Non-filers pay multiples of 2.75% — the single biggest controllable cost on your deal.
- Buyers, budget up. If you are acquiring a 5- or 10-marla plot, factor the higher 2.75% 236K into your entry cost; the buy-side got more expensive, not cheaper.
- Both taxes are adjustable. 236C and 236K are advance taxes, creditable against your annual return — file to reclaim what exceeds your actual liability.
- Small plots dodge 7E. Section 7E deemed-income tax bites on FBR values above Rs 25m, so a Rs 2.5m 5-marla plot is clear of it.
Frequently Asked Questions
Is 236C really 2.75% now, or was it cut to 1.5%?
The 1.5% was only a proposal. The Finance Act 2026 enacted a flat 2.75% for filers for tax year 2026-27 and removed the old value slabs. Always verify against the latest FBR salient features before a transaction, as rates are revised annually.
Did the flat rate make buying cheaper?
Not for small plots. The 236K filer rate on a plot under Rs 50m used to be 1.5%; it is now 2.75%. On a Rs 2.5m 5-marla plot the buyer pays about Rs 31,250 more than before.
Is the tax charged on my purchase price or the FBR value?
On the higher of the FBR-notified value or your declared consideration. For an accurate 236C/236K figure, check the current notified value for your specific Silver City block, not just the market price.
Can I recover 236C and 236K later?
Yes. Both are adjustable advance taxes. If you file your return and your final liability is lower, the excess is credited or refundable — another reason to remain a filer.
The bottom line
The flat 2.75% is a genuine cut for sellers, but it is a blunt instrument: it hands its deepest discounts to the largest transactions and quietly raises the entry cost for small buyers. For a 5-marla filer, the practical result is a Rs 43,750 seller saving offset by a Rs 31,250 heavier buy-side bill. If you are shopping at this end of the market, an RDA-approved society like Silver City — with documented, notified values and clean transfer processes near the Thalian Interchange — keeps your 236C/236K math transparent and your filer credits recoverable, which is exactly what you want when the rate structure itself is working against the small investor.
