Freelancer tax & the 0.25% PSEB rate, explained

If you earn in dollars from clients abroad — software, design, writing, BPO — Pakistan taxes that export income at a concessional final rate instead of normal slabs. Done right, freelancers and IT firms pay far less. Here’s how it works.

The 0.25% rate

IT and IT-enabled service exports can qualify for a reduced final tax of roughly 0.25% on export proceeds (versus the standard 1% for general exporters, or normal income-tax slabs). “Final” means once it’s deducted, that income is settled — it isn’t taxed again at slab rates.

How to qualify

• Register with PSEB (Pakistan Software Export Board) and keep the registration current — it renews annually
• Bring your earnings in through proper banking channels (not informal/cash routes)
• Get a Proceeds Realization Certificate (PRC) from your bank for each remittance — it proves the money is genuine export income
• File your annual return and declare the export income correctly

Keep your money clean

The single most common mistake is receiving payment outside the banking system or without a PRC — that can cost you the concessional rate. Route everything through your bank, collect the PRC, and keep simple records of invoices and receipts. Akountmate handles PSEB registration, tracks your PRCs, and files the return.

Note: tax rules and rates change with each Finance Act, and your situation may differ. This is general guidance, not formal tax advice — Akountmate confirms the exact figures and sections for your business before anything is filed.

Want this handled for you?

Akountmate prepares it, explains it, and files it with your approval.