The federal government has taken a major step by introducing digital prize bonds and issuing the Digital Prize Bonds Registered Rules draft. The Ministry of Finance has also invited feedback from stakeholders and the general public on this new system.
Digital Prize Bonds Transaction via Mobile App
According to the latest notification from the Ministry of Finance, transactions of digital prize bonds will be conducted through a mobile application. This move aims to make the investment process more convenient and transparent.
Key Features of Digital Prize Bonds
The government has outlined several important aspects of digital prize bonds, including:
- Taxation on Prize Money: The prize money will be subject to income tax deductions.
- No Zakat Deduction: Unlike other financial instruments, Zakat will not be applicable to digital prize bonds.
- Unlimited Investment: There is no maximum investment limit, allowing investors to purchase as many bonds as they wish.
- Eligibility: All adult Pakistani citizens can invest in digital prize bonds.
- Non-Transferable Bonds: The ownership of these bonds cannot be transferred or pledged to another person.
Inheritance Rules for Digital Prize Bonds
In the case of an investor’s death, the bond amount will be paid to the legal heirs based on the succession certificate. This rule ensures a smooth transfer of funds to the rightful beneficiaries.
Tax Deduction on Prize Money
As per Section 156 of the Income Tax Ordinance 2001, a withholding tax will be deducted from the prize money:
- 15% tax for filers (active taxpayers).
- 30% tax for non-filers (inactive taxpayers).
The introduction of digital prize bonds marks a significant shift towards a modernized and digital investment system. With transactions managed through a mobile app, the process is expected to be more efficient and secure. Investors are encouraged to review the draft rules and provide their feedback before final implementation.
