Pakistan’s Federal Board of Revenue (FBR) has introduced new tax rules for people who earn money through social media platforms.
The rules cover platforms such as YouTube, TikTok, Instagram and Facebook. They explain how social media income will be calculated, reported and taxed in Pakistan.
The new framework also covers some overseas creators. This applies when their income is treated as Pakistan-source income because they earn from users in Pakistan.
How FBR Will Calculate Social Media Income
FBR has introduced a specific method to calculate income from social media content. The method considers both earnings and allowable expenses.
Under the new rules, creators can claim expenses of up to 30% of their total revenue. FBR will then calculate the creator’s total remuneration using the prescribed method.
The rules also state that FBR will consider whichever amount is higher. This can be the amount calculated through the revenue-per-mille formula or the creator’s actual earnings.
The calculation can include payments received in cash or in kind.
For YouTube, FBR has set an RPM of Rs195 for every 1,000 views. The authority can change this rate in the future.
If a creator believes their actual income was lower than the amount calculated under the RPM formula, they may need to provide evidence. The evidence would be submitted to the relevant tax commissioner.
What Is the 5% Social Media Tax?
The new rules follow the Finance Act 2026. The law introduced a 5% withholding tax on revenue received from social media platforms.
Section 154B covers digital content creators and social media influencers. It applies to earnings from platforms such as YouTube, Facebook, Instagram and TikTok.
The tax is deducted when the relevant income is credited or received through banking channels. Certain payments made through online payment services and digital financial platforms can also fall under the rules.
For resident individuals, the deduction is treated as minimum tax.
For qualifying non-residents without a permanent establishment in Pakistan, the deduction is treated as final tax.
FBR Rules for Overseas Creators
The new framework also covers certain non-resident individuals who earn Pakistan-source income through users in Pakistan.
FBR has set specific user thresholds under the rules. These include more than 50,000 users in a tax year or 12,250 users in a quarter.
Creators who fall under the relevant rules must report their eligible social media income in the appropriate section of their annual income tax return.
The procedure also includes provisions for quarterly advance income tax. Other provisions of the Income Tax Ordinance will continue to apply unless the new rules specifically change them.
What This Means for Pakistani Creators
The new FBR rules provide a clearer framework for taxing social media earnings in Pakistan.
For creators earning money from TikTok, YouTube or Instagram, the rules explain how income can be calculated, reported and taxed.
Creators should keep proper records of their earnings and expenses. They should also check the latest FBR requirements before filing their tax returns.
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