Capital Gains Tax (CGT) on PSX Stocks: Rules, Holding Periods, and Calculation

If you sell shares on the Pakistan Stock Exchange (PSX) at a profit, part of that profit goes to the tax authorities. You do not have to calculate it yourself: the National Clearing Company of Pakistan (NCCPL) computes it and collects it through your broker at settlement. But understanding the rules helps you plan sales, check the amounts deducted, and avoid surprises. This guide covers the rates, how holding periods matter (and when they do not), and how the calculation works.

This is general information based on third-party summaries of the tax law, not tax advice. Sources disagree on some details, noted below. Confirm current rules with the FBR, NCCPL, or a registered tax adviser.

The Core Rule

Capital gains on listed securities are taxed under section 37A of the Income Tax Ordinance. The tax is collected by NCCPL, through your broker, at the time of settlement (T+2). Your gain is the sale proceeds minus your cost. For most individual investors, the amount deducted is credited as advance tax in your annual return, and you declare the gain in that return.

Rates Depend on When You Bought, and Whether You Are a Filer

The rate that applies depends on the date you acquired the shares. Two summaries of the Finance Act 2026 agree on the structure for recent purchases, and one of them notes the Finance Act 2026 left it unchanged for tax year 2026-27.

Purchase date	Filer on the ATL	Non-filer
On or after 1 July 2024 (and 1 July 2025)	15%, no reduction for longer holding	Normal income tax slab rates, with a minimum of 15%
1 July 2022 to 30 June 2024	Tiered by holding period (reported by one guide as 15%, 12.5%, 10%, 7.5%, 5%, 2.5%, then 0% after six years)	Heavier treatment
1 July 2013 to 30 June 2022	12.5% flat	Heavier treatment
Before 1 July 2013	Exempt	Exempt

What this means for holding periods:

• For shares bought after July 2024, holding longer does not lower the rate. A filer pays 15% whether they sell after a week or after five years.
• Holding periods matter for older purchases. If you still own shares bought between July 2022 and June 2024, the tiered schedule may reduce your rate the longer you hold.
• Filer status is tested on both dates. One summary says you must be on the Active Taxpayer List (ATL) on both the purchase and sale dates to get the filer rate.

A note on conflicting guidance. One consultancy guide still shows a simpler schedule of 15% for under 12 months, 12.5% for 12 to 24 months, and 0% after 24 months for filers, with 20% for non-filers. That does not match the two guides above, which describe a flat 15% for post-2024 purchases. Because the figures conflict, check the rate that NCCPL actually applied in your own statement and the current FBR schedule before relying on any holding-period benefit.

How NCCPL Calculates the Tax

• NCCPL tracks your trades across all your broker accounts under your CNIC.
• It uses FIFO (first in, first out): when you sell, the shares you bought earliest are treated as the ones sold.
• The tax equals the applicable rate multiplied by the gain.
• The deduction appears in your settlement and in NCCPL’s CGT statement, which you should reconcile against your own records.

Worked Examples (Filer, Shares Bought After July 2024)

Example 1: A simple sale. You buy 1,000 shares at Rs 100 and sell them at Rs 130.

Item	Amount
Sale proceeds	Rs 130,000
Cost	Rs 100,000
Gain	Rs 30,000
CGT at 15%	Rs 4,500
Gain after tax	Rs 25,500

Example 2: FIFO with two purchase lots. You buy 500 shares at Rs 100 in January and 500 shares at Rs 120 in March, then sell 700 shares at Rs 140.

Lot sold (FIFO)	Shares	Cost per share	Sale price	Gain
January lot	500	Rs 100	Rs 140	Rs 20,000
March lot (part)	200	Rs 120	Rs 140	Rs 4,000
Total gain				Rs 24,000
CGT at 15%				Rs 3,600

The 300 remaining March shares keep their Rs 120 cost for a future sale.

Example 3: Filer vs non-filer. A Rs 100,000 gain on shares bought after July 2024:

	Tax
Filer (15%)	Rs 15,000
Non-filer	At least Rs 15,000, more if the investor’s income slab is higher

Dividends Are Taxed Separately

CGT applies when you sell. Dividends are taxed when you receive them, at source, under section 150: generally 15% for filers and 30% for non-filers. The two taxes are independent, so a share can attract both. See our guide on filer vs non-filer withholding tax for the rate card.

Capital Losses

• Losses on listed securities can generally be set off only against gains on listed securities, not against salary, business, or rental income.
• Unused losses can be carried forward for a limited number of years. Guides differ on how many (three tax years in one, six in another), so confirm the current limit.
• Declare the loss in the return for the year it occurred, or you may lose the right to carry it forward.

Mutual Funds

Mutual funds deduct tax when units are redeemed. One summary says individuals pay 15% on redemptions of both equity and other funds, and that units acquired on or before 30 June 2024 and held more than six years may attract no tax. The conditions are not fully explained, so check your fund’s factsheet or tax statement.

Practical Tips

1. Be on the ATL before you buy and before you sell. This is the single biggest lever on your tax.
2. Keep trade confirmations. They support your cost and date records if a figure is disputed.
3. Reconcile NCCPL’s CGT statement with your own records each year.
4. Declare gains in your annual return and claim the tax deducted as a credit.
5. Think about timing for pre-2024 holdings. If you hold older shares with a tiered schedule, check the tier before selling.
6. Remember costs. Brokerage commission and other charges reduce your net return even though the tax rule is simple.

Final Thoughts

For most people who bought shares after July 2024, PSX capital gains tax is simple: 15% if you are a filer, and the same or more if you are not. The holding-period schedule that used to reward patience now mainly affects older purchases. What matters most today is your filer status and clean records. If you live outside Pakistan, read how overseas Pakistanis can become FBR filers.

Related Guides on PakGains

• Explore the PSX hub and the start-here page
• Pakistan Stock Market (PSX) Beginners Guide
• How to Start Investing in PSX in 2026
• PSX Dividend Investing Guide
• PSX IPO Investing Guide
• How to Open an Account with Full-Service Brokers in Pakistan
• Track the KSE-100 on the PakGains charts page