What is 7E Tax in Pakistan? Deemed Rental Income Explained (FBR Guide)

 

🏠 What is 7E (Section 7E) Property Tax?

Section 7E was introduced by Federal Board of Revenue to tax idle / non-rented properties.

👉 Government assumes your property is generating income even if it is vacant.

---

💰 How 7E Tax Works

$\text{Deemed Income} = 5\% \times \text{Fair Market Value}$

• The law assumes 5% annual rental value
• Then this is taxed like normal income (approx up to 15% for filer)

👉 Simple Example:

• Property value = 1 Crore
• Deemed income = 5 lakh/year
• Tax ≈ 75,000 (approx, depends on slab)