The tax rate on income from provident funds and other retirement funds, which are maintained by companies for their employees, will remain unchanged at 15 percent for the fiscal year 2024-25. 

The National Board of Revenue (NBR) issued a notification yesterday saying that the current 15 percent tax on the income from provident funds will continue into the next fiscal year.

The Finance Bill 2024, presented in parliament yesterday, initially set the income tax rate on these funds at 27.5 percent. The NBR has reduced this rate to 15 percent through a separate notification posted on its website.

The tax administration said that the tax on income from recognised provident funds, approved gratuity funds, approved superannuation funds, and approved pension funds has been reduced to 15 percent. It further stated that firms must comply with certain rules of the income tax law.

(Note: The Daily Star previously reported that the tax rate on the income from provident and other retirement funds would be 27.5 percent from the next fiscal year, based on the rate mentioned in the Finance Bill 2024. We regret this error.)