Digital prize bonds have been introduced by federal officials and draft regulations have been issued. A public consultation has been announced to gather feedback on the new system. With the addition of a mobile application, the government plans to introduce digital prize bonds that can be used with bank accounts or savings accounts at the Central Directorate of National Savings (CDNS).
Quarterly draws will be conducted and prize money will be credited directly to investors’ linked accounts. Tickets for these draws will be available each calendar year at the start of the year.
When investing, investors can nominate beneficiaries, with the flexibility to update or cancel them at any time.
If an investor dies, their legal heirs will receive the bond value and prize money. A nominated person will be paid an amount if the amount is less than Rs. 500,000.
Check Also Draw: Upcoming Prize Bond Check Online All Draw Result
Mobile App for the Transaction of Digital Prize Bonds
The Ministry of Finance announces that it will facilitate digital prize bond transactions using a mobile application. The investment process can be made more enjoyable and efficient by making it more convenient and transparent. Nominations can be made at the time of purchase, allowing investors to modify or cancel them later.
Digital Prize Bonds Key Features
There are several important aspects highlighted by the government in its review of digital prize bonds, including:
- Income Tax on Prize Money: Winners can deduct prize money from their taxes
- Zakat Will Not Apply: In contrast to other financial instruments, Zakat is not applicable to digital prize bonds
- No Maximum Investment: The maximum investment limit for bonds is unlimited, so investors can buy as many bonds as they wish
- Qualifications: Any Pakistani citizen over 18 can invest in digital prize bonds
- Bonds without transferability: In these bonds, the owner may not pass the ownership along to another person
Inheritance Rules for Digital Prizes
In the event of the death of an investor, the bond amount will be paid to his or her legal heirs as outlined in the succession certificate. Using this rule will ensure funds are transferred smoothly to the correct beneficiaries.
Prize money tax deduction:
Under Income Tax Ordinance 2001, Section 156 states that a withholding tax will be deducted from prize money:
- Those who file (active taxpayers) will pay a 15% tax.
- Those who do not file (inactive taxpayers) must pay an additional 30% tax.
The Pakistani Government Plans to Introduce Digital Prize Bonds
At first, the government will issue digital prize bonds worth Rs500, Rs1,000, Rs. 5,000, and Rs.10,000. Whenever the ministry deems it necessary, additional amounts will be announced.
The National Savings app offers Pakistani adults the ability to buy bonds using their bank or savings accounts, as well as other approved CDNS channels.
Investees will receive their prizes directly into their linked accounts, and quarterly draws will occur. During the beginning of each calendar year, these draws will be announced. Beneficiaries can be selected at purchase and modified or canceled at a later date.
