What is the salary tax deduction certificate, and does my employer have to give it to me?

What does the law say?

Section 149 of the Income Tax Ordinance, 2001 makes the person paying salary deduct tax “at the time of payment”. Section 149 sits in Division III of Part V of Chapter X, the division for deductions from payments.

Section 164(1) then says every person deducting tax from a payment under Division III shall, “at the time of collection or deduction of the tax”, furnish to the person paid:

• copies of the Computerized Payment Receipt (CPR), or any other equivalent document; and
• a certificate setting out the amount of tax deducted and such other particulars as may be prescribed.

A proviso adds that where the deductor is notified as a SWAPS agent, the SWAPS Payment Receipt (SPR) replaces the CPR.

Section 164(2) turns to the employee: a person required to file a return “shall attach to the return” copies of the CPR or SPR on the basis of which the certificate was given for tax deducted in that year.

What is a CPR and why does it matter?

A footnote shows the Finance Act, 2022 substituted “Computerized Payment Receipt (CPR)” for the older words “challan of payment”, so the CPR is the payment document for the tax. The certificate is the employer’s statement of what it deducted from you; the CPR copies relate to the payment of that tax. Section 164 asks for both.

A second footnote records that section 164(2) once said the certificate “shall be treated as sufficient evidence of the collection or deduction for the purposes of section 168”. Those words were removed. The current text asks for the CPR copies instead.

How does the employer report my tax to FBR?

Section 165 requires every person deducting tax under Division III to file quarterly statements with the Commissioner. Each statement sets out the name, CNIC, NTN and address of each person paid, the total payments and the tax deducted. Section 165(2) sets the due dates:

Quarter ending	Statement due
31 March	20 April
30 June	20 July
30 September	20 October
31 December	20 January

Section 165(6) adds a separate annual statement for anyone deducting tax under section 149. Rule 44(5) of the Income Tax Rules, 2002 (amended to 24 November 2023) sets that annual statement’s due date as 31 July after the end of the financial year. Section 165(7) separately requires prescribed persons to e-file an annual statement within thirty days of the end of the tax year.

These statements are how deducted tax is linked to your CNIC or NTN in FBR’s records.

How is the certificate used in my return?

Section 168(1)(b) treats tax deducted “as tax paid by the person from whom the tax was collected or deducted”. Section 168(2) allows a tax credit for it in the tax year of deduction. The certificate and CPR copies are the documents that support that credit in your return.

Worked example (illustrative figures)

The name and figures are made up. The salary tax is from the tax year 2027 table.

Hira, a pharmacist employed by a Karachi hospital, salary Rs. 1,440,000 for tax year 2027

• Tax on Rs. 1,440,000: Rs. 6,000 + 11% x Rs. 240,000 = Rs. 32,400
• The hospital deducts Rs. 2,700 a month (Rs. 32,400 / 12)
• Each month it deposits the tax and gets a CPR
• Under section 164(1), Hira is entitled to a certificate showing the tax deducted plus copies of the CPRs
• The hospital lists her CNIC and the Rs. 2,700 monthly deductions in its quarterly statements under section 165
• When Hira files her tax year 2027 return by 30 September 2027, she claims a credit of Rs. 32,400 under section 168 and attaches the CPR copies under section 164(2)
• Her tax liability is Rs. 32,400, her credit is Rs. 32,400, so nothing further is payable

What if I worked for two employers in the year?

Each employer that deducted tax owes you its own certificate under section 164(1), because the duty falls on “every person” deducting tax. Your return claims credit for the combined deductions.

Is there a prescribed form for the salary certificate?

Not in the Rules we hold. Rule 42 of the Income Tax Rules, 2002 prescribes a certificate form for deductions under Division III, but it applies “except in the case of salary”. Division I of that Part of the Rules, headed “Employer’s certificate”, no longer contains a rule: a footnote records that rule 41 was omitted by SRO 1062(I)/2007. The salary certificate format is therefore not prescribed in this edition of the Rules. The obligation in section 164(1) itself does not exclude salary.

Common mistakes

• “The certificate alone proves the tax was paid.” The words that made the certificate sufficient evidence for section 168 were omitted. The CPR copies are what section 164(2) asks you to attach.
• “The employer only has to give it if I ask.” Section 164(1) places the duty on the employer at the time of deduction, without a request.
• “My salary slip is the certificate.” A pay slip shows the deduction, but section 164(1) asks for a certificate plus CPR copies.

What to check in the official text

Read sections 164 and 165 with their footnotes, and rule 44 of the Income Tax Rules, 2002. In the site copy of the Rules, rule 42 is printed under the number “342” because of a footnote marker in the source PDF. Forms prescribed after 24 November 2023 are not in this corpus.