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How to get PRC (Proceed Realization Certificate) for Income Tax for Freelancers in Pakistan

Income Tax FBR Freelancers PakinstanIf you are a freelancer living in Pakistan and withdrawing your Online freelancing income (like from Fiverr, Upwork, Freelancer, Peopleperhour, etc..) through Payoneer or any other method to your bank, you will have to get the PRC (Proceed Realization Certificate issued) to prove the Bank withdrawals as foreign income which will, then, be exempt from tax.

As per Income Tax Ordinance of Pakistan, any foreign remittance will be exempt from tax if you have PRC (Proceed Realization Certificate issued) from your bank. Every bank is responsible for issuance of PRC for any foreign remittance.

However, if you are withdrawing payments through Payoneer in Pakistan, scenario is different. Actually, Payoneer has partnership with Mobilink MicroFinance Bank in Pakistan and when you withdraw money, Payoneer sends money to MMBL which is sent to respective banks as an IBFT (Inter Bank Funds Transfer) which is taxable according to Pakistan Income Tax Law.

So, you will have to get the PRC issued by your Bank to prove that income as foreign income instead of IBFT and also to prove it as white money.

PRC issuance method is given below

  • Contact your Bank with a written application for the issuance of PRC for your transactions
  • Prepare an excel sheet of transactions with amount and date
  • Your bank will send this request to Mobilink MicroFinance Bank for PRC
  • MMBL will issue the PRC and send to your bank
  • You can collect the PRC for free from your branch
  • Now, declare these income as Exempt in Income Tax Return and show the PRC upon FBR Request

In case of any question regarding this matter, drop an email at info@hostinpk.com

Muhammad Jamshed
TRS at Fiverr and Upwork

About the Author
Muhammad Jamshed
I am Level 3 Linux Server Management specialist having vast experience of managing Linxu servers and Wordpress Webdesigning.

4 thoughts on “How to get PRC (Proceed Realization Certificate) for Income Tax for Freelancers in Pakistan

  1. jay - October 6, 2019 at 10:23 am

    As an Update to Above . Payoneer has allowed USD transfer to pakistan (2% fees with minimum $300 withdrawal limit) . please Delete your currently added bank account and Re-add it with currency As USD. thats the best way to do and on your bank statement it will show Foreign Remmitance and no one can raise finger over it. PRC is risky as compared to this method.
    thanks

    Reply
    • Muhammad Jamshed - October 6, 2019 at 10:28 am

      I did the same but still I was unable to get the amount added as a Remittance rather than PRC. 🙁

      Actually, you will have to go through MMBL at every cost which will list your withdrawal as an IBFT and thus you will have to get the PRC.

      Reply
      • Tabish Naqvi - October 6, 2019 at 2:35 pm

        Hi Jamshed,

        That’s not possible if you withdraw in USD instead PKR your funds will come in SWIFT channel and count as Inward Remittance and show as remittance in your bank statement instead of ATM Transfer. I have do that on my personal and business account and for both accounts funds shows as inward remiitance. I don’t know why you are still gettings USD through MMBL. Kindly re-check your when you add you withdrawal bank account currency should be USD instead of PKR.

        Reply
        • Muhammad Jamshed - October 11, 2019 at 10:52 am

          Payoneer does not allow us to get a payment in USD in Paki banks and they send in PKR instead.

          Reply

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