Pakistan FBR Tax Calculator
Pakistan Tax Calculator
2025-2026 | FBR Compliant | Salary & Business
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Pakistan Income Tax, Explained
How salary and business tax are calculated, what filer status changes, and the legal ways to reduce what you owe.
Effective Rate vs Marginal Rate
Marginal Rate
Rate on your last rupee earned
Effective Rate
Actual % of income paid
Someone earning PKR 2,500,000 a year reaches the 23% slab, but their effective rate is much lower. Under the progressive system, only the income within each bracket is taxed at that bracket's rate — so only the amount above PKR 2,200,000 is taxed at 23%.
Salary Tax Slabs — 2025-2026
| Annual Taxable Income (PKR) | Fixed Tax | Rate on Excess |
|---|---|---|
| Up to 600,000 | None | 0% |
| 600,001 – 1,200,000 | 0 | 1% above 600,000 |
| 1,200,001 – 2,200,000 | 6,000 | 11% above 1,200,000 |
| 2,200,001 – 3,200,000 | 116,000 | 23% above 2,200,000 |
| 3,200,001 – 4,100,000 | 346,000 | 30% above 3,200,000 |
| Above 4,100,000 | 616,000 | 35% above 4,100,000 |
Non-filers pay double the standard rate on every bracket above PKR 600,000.
Tax Examples for Common Salary Levels
| Monthly Salary | Annual Income | Annual Tax | Effective Rate |
|---|---|---|---|
| 50,000 | 600,000 | 0 | 0% |
| 100,000 | 1,200,000 | 6,000 | 0.5% |
| 150,000 | 1,800,000 | 72,000 | 4.0% |
| 200,000 | 2,400,000 | 162,000 | 6.75% |
| 300,000 | 3,600,000 | 466,000 | 12.9% |
| 500,000 | 6,000,000 | 1,281,000 | 21.35% |
Deductions That Legally Reduce Your Tax
Zakat and donations
Zakat deducted at source by a scheduled bank is fully deductible from taxable income with no upper limit. Donations to institutions approved under Section 61 qualify for a tax credit of up to 30% of taxable income.
Medical allowance
A medical component in your salary is exempt up to 10% of basic salary or PKR 25,000 a year, whichever is lower.
Pension contributions
Contributions to an FBR-approved pension scheme earn a tax credit under Section 63. The eligible limit rises from 20% of taxable income under 40, to 40% at 50 and above.
Business and AOP Tax Rates
| Annual Net Income (PKR) | Rate |
|---|---|
| Up to 400,000 | 0% |
| 400,001 – 600,000 | 10% |
| 600,001 – 1,200,000 | 15% |
| 1,200,001 – 2,400,000 | 20% |
| 2,400,001 – 3,000,000 | 25% |
| 3,000,001 – 4,000,000 | 30% |
| Above 4,000,000 | 35% |
Filer vs Non-Filer
| Transaction | Filer | Non-Filer |
|---|---|---|
| Salary tax | Standard | 2x rate |
| Cash withdrawal | 0.6% | 1.2% |
| Dividend income | 15% | 30% |
| Bank deposit profit | 15% | 30% |
Filing Deadlines
| Obligation | Deadline |
|---|---|
| Individuals & AOPs return | 30 Sep |
| Companies return | 31 Dec |
| ATL eligibility | 31 Mar |
| Advance tax | Quarterly |
How to Become a Filer
| Step | What to Do |
|---|---|
| 1. Get an NTN | Register on FBR's IRIS portal with your CNIC, email, and mobile number. Free, issued within 24 hours. |
| 2. Log in to IRIS | Salaried individuals use the Simplified Return. Business owners use the standard form. |
| 3. File your return | Enter income, allowable deductions, and tax already withheld. Filing is free. |
| 4. Confirm ATL status | Usually added within 24 to 48 hours. Reduced rates apply as soon as you're listed. |
Frequently Asked Questions
Q.
How is salary tax calculated in Pakistan?
Taxable income (gross salary minus allowable deductions) is matched to the FBR slab table, where a fixed base tax is added to a percentage of the amount above each slab's lower limit. Your employer deducts the total proportionally each month.
Q.
What is the tax-free income limit?
Annual salary up to PKR 600,000 (PKR 50,000 a month) is fully exempt for both filers and non-filers. Above that, tax applies only to the amount over PKR 600,000, not your whole salary.
Q.
What is the difference between a filer and a non-filer?
A filer is on the Active Taxpayer List because they filed their latest return. A non-filer has not, and pays 100% extra income tax plus higher withholding on banking, property, and vehicle transactions. Registering is free and usually takes under a week.
Q.
What is the 9% surcharge on income tax?
A 9% surcharge applies to the total tax payable when annual taxable income exceeds PKR 10,000,000. It is charged on the tax amount, not the income.