From July 1, 2026, Pakistan has started a new tax reporting system. Banks and other financial institutions must now electronically report to the Federal Board of Revenue (FBR) any bank accounts where total deposits or withdrawals cross Rs. 10 crore (Rs. 100 million) in any six months.
This rule comes under the Finance Act 2026. The main goal is to improve tax compliance and reduce tax evasion. The FBR will use digital tools to automatically match this banking data with taxpayers’ income tax returns, sales tax records, and other filings.
If there are big differences, such as under-reported income, hidden sales, inflated expenses, or other mismatches, the cases will be sent for further checks through the FBR’s compliance system. Authorities promise that all information will stay confidential and will be handled through a secure digital platform to protect privacy.
This step is part of broader efforts to widen the tax net and bring more transparency to the financial system. Experts believe it will help catch tax irregularities without unnecessary harassment, as the process is mostly automated and faceless.
Taxpayers with genuine high business activities are advised to keep proper records and file accurate returns to avoid any issues. The new system is expected to strengthen overall tax collection in the country.
