How much more advance tax does a non-filer pay than a filer when buying or transferring a car?

Buying a car costs noticeably more in advance income tax for someone who is not in the active taxpayers’ list. The Ordinance sets no separate “non-filer” rate table. It takes the ordinary rate in the First Schedule and increases it under the Tenth Schedule. This page uses the Income Tax Ordinance, 2001 as amended to 30 June 2026, so the figures apply to tax year 2027.

What does the law say?

Section 100BA says that collection or deduction of advance tax for a person not appearing in the active taxpayers’ list is determined in accordance with the Tenth Schedule, and that the Tenth Schedule has effect notwithstanding anything to the contrary in the Ordinance.

Rule 1 of the Tenth Schedule sets two different increases:

• General rule. Where tax is to be deducted or collected from a person not in the list, the rate is increased by hundred percent of the rate specified in the Ordinance. That doubles it.
• Cars under section 231B. The first proviso says tax collected under section 231B is increased by two hundred percent of the rate specified in the First Schedule. That makes it three times the ordinary rate.

Section 231B covers the collection at sale by the manufacturer, at first registration, at registration of a car resold before registration, and at transfer of registration or ownership. Section 234 covers advance tax collected with provincial motor vehicle tax, often called token tax, and falls under the general one hundred percent rule.

How do the rates compare?

New car at sale or registration (section 231B(1) and (3), Division VII clause (1))

Engine capacity	On the list	Not on the list (x3)
Up to 850cc	0.5% of value	1.5% of value
851cc to 1000cc	1%	3%
1001cc to 1300cc	1.5%	4.5%
1301cc to 1600cc	2%	6%
1601cc to 1800cc	3%	9%
1801cc to 2000cc	5%	15%
2001cc to 2500cc	7%	21%
2501cc to 3000cc	9%	27%
Above 3000cc	12%	36%

Transfer of a registered car (section 231B(2), Division VII clause (2)), before the yearly reduction in that clause:

Engine capacity	On the list	Not on the list (x3)
Up to 850cc	Nil	Nil
851cc to 1000cc	Rs. 5,000	Rs. 15,000
1001cc to 1300cc	Rs. 7,500	Rs. 22,500
1301cc to 1600cc	Rs. 12,500	Rs. 37,500
1601cc to 1800cc	Rs. 18,750	Rs. 56,250
1801cc to 2000cc	Rs. 25,000	Rs. 75,000
2001cc to 2500cc	Rs. 37,500	Rs. 112,500
2501cc to 3000cc	Rs. 50,000	Rs. 150,000
Above 3000cc	Rs. 62,500	Rs. 187,500

Annual collection with motor vehicle tax (section 234, Division III clause (3))

Engine capacity	On the list	Not on the list (x2)
Up to 1000cc	Rs. 800	Rs. 1,600
1001cc to 1199cc	Rs. 1,500	Rs. 3,000
1200cc to 1299cc	Rs. 1,750	Rs. 3,500
1300cc to 1499cc	Rs. 2,500	Rs. 5,000
1500cc to 1599cc	Rs. 3,750	Rs. 7,500
1600cc to 1999cc	Rs. 4,500	Rs. 9,000
2000cc and above	Rs. 10,000	Rs. 20,000

Where motor vehicle tax is collected in lump sum, clause (4) of Division III sets amounts from Rs. 10,000 (up to 1000cc) to Rs. 120,000 (2000cc and above), and the same doubling applies.

Worked example (illustrative figures)

Bilal in Karachi buys a locally assembled 1,500cc car with an invoice value of Rs. 6,500,000, inclusive of all duties and taxes. He is not in the active taxpayers’ list.

1. Band: 1301cc to 1600cc, ordinary rate 2%.
2. Tax if he were on the list: Rs. 6,500,000 x 2% = Rs. 130,000.
3. Tenth Schedule increase of two hundred percent: 2% + 4% = 6%.
4. Tax collected from Bilal: Rs. 6,500,000 x 6% = Rs. 390,000.
5. Extra cost of not being on the list: Rs. 390,000 - Rs. 130,000 = Rs. 260,000.

When he later pays annual motor vehicle tax, the section 234 amount for a 1,500cc car is Rs. 3,750 on the list, doubled to Rs. 7,500 for him.

What happens to the extra tax?

Section 231B(5) and section 234(5) both make the tax adjustable. Rule 3 of the Tenth Schedule adds a consequence: if tax was collected under rule 1 and the person does not file a return for that tax year by the due date, the Commissioner makes a provisional assessment, imputing income from the tax collected and treating it as concealed income for section 111(1)(d). Under rule 4, that provisional assessment abates if the returns and wealth statement for the relevant and preceding tax year are filed within forty-five days of receiving it, and rule 4(3) makes the tax collected under rule 1 adjustable against the tax payable in the return.

What if the buyer was not required to file a return?

Rule 2 of the Tenth Schedule lets the person collecting the tax notify the Commissioner electronically, before collecting, that the buyer was not required to file a return under section 114. The Commissioner has thirty days to accept or reject; silence for thirty days counts as acceptance.

Common mistakes

• Assuming every vehicle tax is doubled. Section 231B collections are tripled by the specific proviso. Only other collections, such as section 234, follow the general doubling.
• Treating “filer” as enough. The test in the Tenth Schedule is whether the name appears in the active taxpayers’ list, not whether a return was ever filed.
• Assuming leasing follows the same table. Section 231B(1A) separately sets 4% of the vehicle value when a bank or leasing company leases a vehicle to a person not in the list. The Tenth Schedule proviso refers to the rate “specified in First Schedule”, and the text does not say whether it also applies to the rate written into section 231B(1A).

What to check in the official text

Read section 100BA, rules 1 to 4 of the Tenth Schedule, section 231B, section 234, clauses (1) to (3) of Division VII and clauses (3) and (4) of Division III of Part IV of the First Schedule. Check the Second Schedule for any clause that switches off section 100BA and rule 1 for a particular class of person, since several exist and this page does not list them.