Pakistan Tax FAQ — Common Questions Answered

Frequently Asked Questions

How is salary tax calculated in Pakistan for FY 2026-27?

The FY 2026-27 FBR salaried schedule applies progressive rates across eight brackets. Each bracket taxes only the income that falls within it, and the top 35% rate applies above Rs. 7 million. Add the tax from every bracket to find the final amount.

What is the tax-free income threshold for salaried individuals?

For FY 2026-27, the first Rs. 600,000 of annual salaried income carries a 0% rate, the same threshold as FY 2025-26. The remaining FBR slabs apply progressive rates to income above that threshold.

What are the FY 2026-27 salaried slab rates?

Finance Act 2026 restructured four brackets and added two new brackets. The 35% top rate now starts at Rs. 7 million instead of Rs. 4.1 million, so higher-income earners pay lower rates on the Rs. 4.1M–7M band. Review the full slab table below.

Is there still a surcharge for high-income salaried individuals in FY 2026-27?

No. Finance Act 2026 abolished the Section 4AB surcharge on salaried income above Rs. 10,000,000. Non-salaried individuals and AOPs still pay a 10% surcharge on tax payable above the same threshold.

What is "taxable income"?

Taxable income equals gross income minus allowable deductions, exemptions, and tax credits, such as Zakat, approved donations, and pension contributions. The FBR applies slab rates to taxable income, not gross salary. TaxCalc uses gross income as a proxy, so deductions may reduce your final taxable income.

Does super tax apply to me?

Super tax (Section 4C) generally applies only to companies and high-income earners above Rs. 500 million in annual income. Finance Act 2026 raised this threshold from Rs. 150 million for most sectors. Salaried individuals and ordinary AOPs usually do not pay super tax. See our Super Tax Calculator for a full breakdown.

How does AOP tax differ from salaried individual tax?

AOPs share the same Rs. 600,000 tax-free threshold as individuals, but Pakistan applies a steeper progressive schedule to AOP income. The AOP rate reaches 45%, versus 35% for salaried employees. AOPs also pay the 10% high-income surcharge. Select "Business / Individual" or "AOP" above to see the exact breakdown.

Can I see how my tax compares to last year?

Yes. Use the Compare Years tool to see the exact tax difference between FY 2025-26 and FY 2026-27, slab by slab, for salaried, Business / Individual, or AOP income.

Related Tools