A Complete Explanation of Remittance and Certificate for Overseas Pakistanis

Published On - 24/08/2025

admin Income Tax

A Complete Explanation of Remittance and Certificate for Overseas Pakistanis

When overseas Pakistanis send money back to their country, several questions come to their mind:

  1. Will these amounts really be considered “remittances”?
  2. How will it be proven to the FBR that the money has come from abroad?
  3. Is just a account statement enough or is a separate certificate required?
  4. What to do if the bank does not issue a certificate and where can a complaint be filed?

All these questions are important because proof is required while reporting remittances in the income tax return.

Conditions for foreign Remittance:

As everyone knows, remittances from abroad are exempt from income tax. However, to benefit from this exemption, it is mandatory to fulfil the conditions set by the State Bank, which are as follows:

(i) The amount must be in the form of Foreign Exchange.

(ii) The amount must be transferred from outside Pakistan through regular banking channels

(iii) The amount must be encashed through a scheduled bank.

(iv) A certificate of encashing must be obtained from the concerned bank.

This certificate is issued by the same financial institution that receives the foreign exchange from abroad and pays it to the beneficiaries knows as Proceeds Realization Certificate or PRC.

FBR Requirement: PRC

FBR has set a condition that you should have a PRC (Proceeds Realization Certificate) to consider money coming from abroad as “remittance”.

What is PRC?

  1. This is a formal document issued by a local bank.
  2. It states that so much money came from abroad on such and such date, for what purpose and in what currency.
  3. The bank converted this amount into Pakistani rupees at the foreign exchange rate and deposited it in the relevant account.
  4. It has a reference number which can be verified by FBR or State Bank from its portal.

PRC Details

A separate PRC is issued for each transaction. For example, if a person receives 10 transactions in a month, he will have to obtain 10 different PRCs for each transaction.

The PRC document usually contains the following information:

  1. Certificate number and date of issue
  2. Name of sending country and bank
  3. Foreign currency sent and its rate
  4. Amount converted into Pakistani rupees
  5. Account holder’s name, CNIC and NTN number
  6. Purpose of sending (Home Remittance, Freelancing, IT Services, Gift etc.)

Example:

If you sent $1000 on August 22, the record will state:

Amount: 1000 USD

Conversion Rate: e.g. Rs. 284.57

Equivalent in PKR: Rs. 283,577

Purpose: Home Remittance

 E-PRC (Annual Certificate)

If you have many foreign transactions throughout the year, it is difficult to get a certificate every time. For this, you can ask your bank for an E-PRC at the end of the year. It contains a record of all transactions for the entire year, such as from July 1, 2024 to June 30, 2025. This single document provides you with easy and more comprehensive proof.

Status of funds in Roshan Digital Account

  1. Roshan Digital Account is specially designed for overseas Pakistanis (As the NICOP is mandatory which is evident that the account holder is a non-resident Pakistani)
  2. The special thing about this account is that local money cannot be deposited in it, only money coming from abroad can come.
  3. For this reason, every money coming here is considered a remittance.
  4. The statement itself is sufficient proof because the nature of the account itself indicates that it is for overseas only.
  5. The FBR also does not demand a separate certificate in the case of Roshan Digital Account.

How to obtain a PRC?

  1. First, submit a written request to your bank (via email or in person at the branch).
  2. Explain in the request that you need this certificate for your income tax return, which covers the period from July 1 to June 30.
  3. If the bank does not respond within the specified time, contact the helpline, and if necessary, file a formal complaint with the State Bank or the Banking Ombudsman.

Risk without a certificate

If you report remittances by showing only the statement and do not take the PRC, then it is a big risk.

The FBR may ask you for proof, and if you cannot show it, it will consider your remittance as “undeclared income” and tax it.

It may be difficult to appeal and explain later.

Bank Mistakes and Precautions

Sometimes bank staff make mistakes while creating certificates.

For example, you sent Rs 1 crore throughout the year, but Rs 9 million was recorded in the record.

The reason is that the certificate is often created manually, that is, the staff notes the transactions separately after seeing the account statement.

Therefore, it is important to:

Match each PRC or E-PRC with your account statement.

If there is any difference, inform the bank immediately.

Conclusion and Advice

  1. If you have a Roshan Digital Account, then only the statement is enough.
  2. If you have a regular account, get a mandatory PRC.
  3. Annual E-PRC is better and easier proof.
  4. Always compare the certificate with your statement.
  5. Remittance without a valid document is risky and can cause tax problems.

A Complete Explanation of Remittance and Certificate for Overseas Pakistanis  explained all important points, For more Information, please get in touch with us through our website by filling out the Contact Us form, or reach out via our social media accounts.