As per Lawkidunya, In Pakistan, income tax on property sale is governed by the Income Tax Ordinance, 2001. Here’s an overview:

Tax Rates

1. 5% tax rate: Applies to gains from the sale of immovable property, including land, houses, and apartments, if the property is sold within 5 years of acquisition.
2. 2.5% tax rate: Applies to gains from the sale of immovable property if the property is sold after 5 years but within 8 years of acquisition.
3. 0% tax rate: Applies to gains from the sale of immovable property if the property is sold after 8 years of acquisition.

Tax Calculation

1. Gross sale value: The sale price of the property.
2. Cost of acquisition: The original purchase price of the property.
3. Cost of improvement: Any costs incurred to improve or renovate the property.
4. Capital gain: The difference between the gross sale value and the cost of acquisition plus cost of improvement.

Tax Deductions

1. Cost of acquisition: Deductible from the gross sale value.
2. Cost of improvement: Deductible from the gross sale value.
3. Transfer costs: Deductible from the gross sale value, including stamp duty, registration fees, and other transfer costs.

Tax Filing Requirements

1. Tax Return: Taxpayers must file a tax return (Form A) to report capital gains from property sale.
2. Statement of Assets and Liabilities: Taxpayers must file a statement of assets and liabilities (Form B) to report immovable property assets.
3. Supporting Documents: Taxpayers must maintain supporting documents, such as sale deeds, purchase deeds, and transfer documents.

Penalties for Non-Compliance

1. Late Filing Fee: A penalty of Rs. 20,000 to Rs. 50,000 for late filing of tax return.
2. Default Surcharge: A penalty of up to 25% of the tax due for non-payment or underpayment of tax.
3. Prosecution: Taxpayers may be prosecuted for tax evasion or non-compliance with tax laws.

It’s essential to consult with a tax professional or the Federal Board of Revenue (FBR) to ensure compliance with the tax laws and regulations in Pakistan.