ISLAMABAD: There would be no withholding tax on cash withdrawal from banks up to the limit of Rs 50,000. Sources told Business Recorder here on Friday that the FBR's explanatory circular to be issued on Monday (July 30) would clarify applicability of the withholding tax on cash withdrawals from banks.
Through Finance Act 2012, aggregated daily cash withdrawal limit without subjecting it to withholding tax has been enhanced to Rs 50,000 from Rs 25,000. The rate of withholding tax remains at 0.2 percent, sources added. When contacted, a tax expert said that if the cash withdrawal from banks exceeds Rs 50,000, then the entire amount shall be subject to withholding of 0.2 percent. From example, if Rs 51,000 is being withdrawn, the tax withheld would be Rs 102.
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