If your business provides services in Punjab, sales tax on those services is not collected by FBR. It is collected by the Punjab Revenue Authority (PRA) under the Punjab Sales Tax on Services Act, 2012. Software houses, consultants, advertising agencies, restaurants, contractors, salons and many other service businesses in Lahore, Faisalabad, Rawalpindi and Multan are expected to register with PRA, charge tax on taxable services and file returns. This guide explains who must register, how PRA registration works, and how it fits with your FBR registration.
Quick answer: Any person providing a taxable service in Punjab must register with the Punjab Revenue Authority. PRA says there is no turnover threshold for taxable services and no registration fee. You need an NTN first; businesses already registered with FBR for sales tax can be enrolled with PRA using their existing number. After registration you charge the applicable rate (16% standard rate for most services, per PRA) and file a monthly return through PRA’s e-portal.
Why do service businesses register with PRA instead of FBR?
Under Pakistan’s constitutional arrangement, sales tax on services is a provincial subject. Each province has its own law and collector: PRA in Punjab, the Sindh Revenue Board (SRB), the Khyber Pakhtunkhwa Revenue Authority (KPRA) and the Balochistan Revenue Authority (BRA). FBR collects sales tax on goods nationwide and on services in the Islamabad Capital Territory. Our sales tax registration guide explains the FBR side; this article covers Punjab services.
A business that sells both goods and services, such as a company that supplies equipment and also installs and maintains it, may need both registrations.
Who must register with PRA?
According to PRA’s registration FAQs, anyone providing taxable services in Punjab must register, and no exemption threshold applies to taxable services. Taxable services are listed in the Second Schedule to the Act, which PRA updates through Finance Acts. Common categories include:
- IT, software development and IT-enabled services
- Consultancy, technical, accounting, legal and professional services
- Advertising, marketing and event management
- Restaurants, caterers, hotels and franchise services
- Construction, contractors and engineering services
- Beauty parlours, gyms, courier, security and many others
Some services are taxed at reduced rates, and some are exempt. Check the current schedule for your specific service before you set prices, because the rate becomes part of your invoice.
How do you register with PRA, step by step?
- Get an NTN. PRA registration is linked to your NTN. See our NTN registration guide.
- Apply on PRA’s e-registration portal with your business details, nature of services, business address in Punjab, bank account and the CNICs of the owner, partners or directors.
- Upload supporting documents such as the incorporation certificate or partnership deed, proof of premises and a bank account certificate.
- Receive your PRA registration. PRA states that persons already registered with FBR for sales tax get a PRA number formed by adding a “P” prefix to their existing registration number.
PRA does not charge a fee for registration. Businesses based outside Punjab that provide taxable services in the province can enrol with PRA using their NTN.
What is the PRA sales tax rate on services?
PRA lists 16% as the standard rate, with different rates for specific services such as telecommunications. Several services carry reduced rates, sometimes without input tax adjustment. Because these rates change through Punjab Finance Acts, confirm the current rate for your service code in the PRA schedule before invoicing.
What are your obligations after PRA registration?
- Issue tax invoices showing your PRA registration number, the service, its value and the tax charged.
- File monthly returns on PRA’s e-portal and deposit the tax through designated banks or e-payment channels, including nil returns where applicable.
- Withhold tax where required. Certain registered persons and government bodies must withhold PRA tax when they pay service providers.
- Keep records of contracts, invoices and payments for audit.
PRA also notes that a newly registered person must account for tax from the date the service became taxable, not only from the registration date. Registering late does not erase earlier liability. Our compliance calendar shows how PRA returns line up with FBR and SECP deadlines.
Do government tenders and corporate clients ask for PRA registration?
Yes, frequently. Government departments in Punjab and large companies usually require service suppliers to show active PRA registration so the tax on their invoices can be claimed or withheld correctly. If you bid for public contracts, also read our guides to PPRA registration and why government bids get rejected.
Frequently asked questions
Is PRA registration mandatory for service providers in Punjab?
Yes. PRA states that anyone providing taxable services in Punjab must register, and there is no turnover threshold for taxable services.
Is there a fee for PRA registration?
No. PRA does not charge a fee for registration.
I am already registered with FBR for sales tax. Do I need a new PRA number?
PRA states that persons already registered with FBR are enrolled using their existing registration number with a “P” prefix.
What is the sales tax rate on services in Punjab?
PRA lists 16% as the standard rate, with different or reduced rates for specific services. Check the current PRA schedule for your service.
Do I pay PRA tax for the period before I registered?
Yes. PRA expects a newly registered person to account for tax from the date the service became taxable, not only from the date of registration.
How CEC can help with PRA registration
Connect Engineers & Consultants registers service businesses with PRA and FBR, checks which service codes and rates apply, and supports monthly filing. See our tax compliance service.
Providing services in Punjab? Contact our team to check your PRA position before your next invoice.
PRA rates, schedules and procedures change through Punjab Finance Acts and PRA notifications. Confirm current requirements with PRA before you register or invoice. This guide is general information, not tax advice.
