As Pakistan advances its economic reform agenda, the real estate sector is undergoing a transformation that’s particularly meaningful for overseas investors. In 2025, a new wave of tax reforms was introduced to remove long-standing barriers and offer greater clarity, creating a more streamlined and attractive path for those looking to own luxury apartments or hotel residences in Pakistan’s leading cities.
Whether you’re considering a high-end apartment in Islamabad or Lahore, these updates are shaping a more accessible and investor-aligned landscape.
Section 7E and CVT: Two Major Barriers Rolled Back
For years, Section 7E, which taxes “deemed rental income” on property, has created complications for non-resident investors. Paired with the Capital Value Tax (CVT) — a levy applied during property transactions, these provisions have increased the cost of holding and transferring real estate, especially in premium segments.
In 2025, a set of proposals submitted by the Task Force for Housing Sector Development recommended abolishing both Section 7E and CVT to ease investment barriers and streamline property transactions. According to Property Guide Pakistan, if adopted, these changes could play a key role in reviving investor confidence, particularly among overseas Pakistanis interested in lifestyle-led or income-generating real estate.
Faster, Clearer Transactions
A central proposal within the 2025 tax reform recommendations is the simplification of property transfer procedures, particularly through the removal of the requirement to file declarations under Section 7E before completing a transaction. This change, if implemented, would significantly reduce delays associated with approvals and certifications — a notable improvement for overseas investors managing purchases remotely. For those looking to invest in premium residential or hotel-style managed residences, a more streamlined transaction process would offer greater ease and certainty
Exclusive Tax Relief for Overseas Pakistanis
Perhaps the most impactful reform for the diaspora is the clarification of exemptions under Sections 236C and 236K of the Income Tax Ordinance. The Federal Board of Revenue (FBR) has confirmed that Pakistanis holding a NICOP or POC are now exempt from advance taxes, even if they are not on the Active Taxpayer List (ATL). This reduces acquisition costs and makes high-value investments more financially efficient.
An Evolving Market Built on Confidence
These reforms go beyond surface-level tax cuts. By removing outdated rules, accelerating administrative procedures, and prioritising the needs of overseas buyers, Pakistan is working to build a more investor-friendly real estate ecosystem. For those seeking secure, fully managed investments or long-term lifestyle properties, the changes point to a maturing market backed by reform.
Why Now Is the Right Time
With international institutions like the IMF endorsing Pakistan’s broader economic direction, these tax changes represent more than just policy updates — they symbolise a turning point. For overseas Pakistanis who previously felt held back by policy ambiguity, the environment is shifting decisively toward openness and opportunity.
The new tax regime lowers barriers and adds clarity, paving the way for confident investment in luxury real estate and high-quality managed residences in one of South Asia’s most promising markets.
Developers like One Homes are building for this moment — creating internationally designed, fully managed properties in Islamabad and Lahore that align with global investor expectations. For overseas buyers seeking peace of mind, long-term value, and a genuine connection to their roots, this is a window of opportunity worth exploring.
