Pakistan Salary Tax Slabs 2026-27 at a Glance
Pakistan's tax year runs from 1 July to 30 June. The slabs below apply to salary earned from 1 July 2026 to 30 June 2027, which is called tax year 2027. They were introduced by the Finance Act, 2026.
These rates are for salaried individuals, meaning people whose salary is more than 75% of their taxable income.
| Annual taxable salary | Tax |
|---|---|
| Up to Rs. 600,000 | Nil |
| Rs. 600,001 - 1,200,000 | 1% of the amount above Rs. 600,000 |
| Rs. 1,200,001 - 2,200,000 | Rs. 6,000 + 11% of the amount above Rs. 1,200,000 |
| Rs. 2,200,001 - 3,200,000 | Rs. 116,000 + 20% of the amount above Rs. 2,200,000 |
| Rs. 3,200,001 - 4,100,000 | Rs. 316,000 + 25% of the amount above Rs. 3,200,000 |
| Rs. 4,100,001 - 5,600,000 | Rs. 541,000 + 29% of the amount above Rs. 4,100,000 |
| Rs. 5,600,001 - 7,000,000 | Rs. 976,000 + 32% of the amount above Rs. 5,600,000 |
| Above Rs. 7,000,000 | Rs. 1,424,000 + 35% of the amount above Rs. 7,000,000 |
The rates are progressive. Moving into a higher slab does not raise the tax on your whole salary, only on the part that falls inside that slab.
How Much Tax on Your Monthly Salary
The table shows the tax for common monthly salaries, assuming the same salary for all twelve months and no other taxable income.
| Monthly salary | Annual salary | Tax per year | Tax per month |
|---|---|---|---|
| Rs. 50,000 | Rs. 600,000 | Nil | Nil |
| Rs. 75,000 | Rs. 900,000 | Rs. 3,000 | Rs. 250 |
| Rs. 100,000 | Rs. 1,200,000 | Rs. 6,000 | Rs. 500 |
| Rs. 150,000 | Rs. 1,800,000 | Rs. 72,000 | Rs. 6,000 |
| Rs. 200,000 | Rs. 2,400,000 | Rs. 156,000 | Rs. 13,000 |
| Rs. 250,000 | Rs. 3,000,000 | Rs. 276,000 | Rs. 23,000 |
| Rs. 300,000 | Rs. 3,600,000 | Rs. 416,000 | Rs. 34,667 |
| Rs. 500,000 | Rs. 6,000,000 | Rs. 1,104,000 | Rs. 92,000 |
Worked Example: Salary of Rs. 250,000 a Month
- Annual taxable salary: Rs. 250,000 x 12 = Rs. 3,000,000
- This falls in the Rs. 2,200,001 - 3,200,000 slab
- Fixed amount for the slab: Rs. 116,000
- Amount above Rs. 2,200,000: Rs. 800,000
- 20% of Rs. 800,000: Rs. 160,000
- Tax for the year: Rs. 276,000
- Monthly deduction: Rs. 23,000
Take-home pay before any other deductions is Rs. 227,000 a month.
What Changed From 2025-26
Tax on annual salary up to Rs. 2,200,000 is the same as last year. The relief is for salaries above that level.
| Annual taxable salary | Rate in 2025-26 | Rate in 2026-27 |
|---|---|---|
| Up to Rs. 600,000 | 0% | 0% |
| Rs. 600,001 - 1,200,000 | 1% | 1% |
| Rs. 1,200,001 - 2,200,000 | 11% | 11% |
| Rs. 2,200,001 - 3,200,000 | 23% | 20% |
| Rs. 3,200,001 - 4,100,000 | 30% | 25% |
| Rs. 4,100,001 - 5,600,000 | 35% | 29% |
| Rs. 5,600,001 - 7,000,000 | 35% | 32% |
| Above Rs. 7,000,000 | 35% | 35% |
What that means in rupees:
| Monthly salary | Monthly tax 2025-26 | Monthly tax 2026-27 | Saving per year |
|---|---|---|---|
| Rs. 150,000 | Rs. 6,000 | Rs. 6,000 | Nil |
| Rs. 200,000 | Rs. 13,500 | Rs. 13,000 | Rs. 6,000 |
| Rs. 250,000 | Rs. 25,000 | Rs. 23,000 | Rs. 24,000 |
| Rs. 300,000 | Rs. 38,833 | Rs. 34,667 | Rs. 50,000 |
| Rs. 500,000 | Rs. 106,750 | Rs. 92,000 | Rs. 177,000 |
The surcharge that applied to individuals with taxable income above Rs. 10 million was also reported as removed for salaried individuals from 1 July 2026.
What Counts as Taxable Salary
The slabs apply to taxable salary, which is usually wider than basic pay. It generally includes:
- Basic salary
- House rent, conveyance, utilities, and most other cash allowances
- Bonuses, commissions, and overtime
- The taxable value of perquisites such as a company car or employer-provided housing
A few items are exempt or partly exempt. The best-known is the medical allowance, which is exempt up to 10% of basic salary when free medical treatment or reimbursement is not already provided by the employer. Your payroll team applies these rules before calculating tax.
How Tax Is Deducted From Your Salary
Employers withhold income tax every month under Section 149 of the Income Tax Ordinance, 2001. Each month, payroll:
- Estimates your taxable salary for the full tax year, including expected bonuses
- Calculates the annual tax using the slabs
- Adjusts for any tax credits or tax already paid that you have declared, such as tax collected on your mobile phone or vehicle
- Spreads the remaining tax across the months of the year
This is why the deduction can change during the year after an increment or a bonus. On the payslip it appears as a single line, usually labelled income tax or tax deducted, in the deductions section. The other lines are explained in how to read a salary slip.
After the year ends, your employer gives you a salary certificate showing the salary paid and the tax deducted. You use it to file your income tax return through the FBR's IRIS portal. The due date for salaried individuals is normally 30 September.
Other Deductions on a Pakistani Salary Slip
Income tax is not the only deduction between gross and net pay.
- EOBI: The employee contribution to the Employees' Old-Age Benefits Institution is 1% of the minimum wage, with the employer paying a further 5%. Because it is tied to the notified minimum wage and not to your actual salary, it is a small fixed amount of a few hundred rupees a month.
- Provident fund: Where an employer runs a provident fund, the employee contribution is typically around 8% to 10% of basic salary, with a matching employer contribution.
- Social security: Provincial social security contributions are paid by the employer for lower-paid workers and do not usually reduce the employee's pay.
- Loans and advances: Repayments of salary advances or company loans.
A general explanation of statutory and voluntary deductions is in our payroll deductions guide.
Ways to Reduce Your Tax Legally
- Declare tax already paid. Advance tax collected on mobile top-ups, vehicle registration, and similar transactions can be adjusted against salary tax if you give the evidence to your employer or claim it in your return.
- Claim tax credits. Credits are available for approved charitable donations and for contributions to an approved voluntary pension scheme, within limits.
- Check your allowances. Make sure exempt items such as the medical allowance are structured correctly in your salary.
- File your return on time. Being on the Active Taxpayers List means lower withholding tax rates on banking, property, and vehicle transactions.
Create a Salary Slip in Pakistani Rupees
To show these figures on a payslip, enter your earnings, income tax, and other deductions in our free salary slip generator, choose PKR as the currency, and download the PDF. If you are preparing documents for a bank, see salary slip for bank loan.
Conclusion
For tax year 2027, salary up to Rs. 600,000 a year remains tax-free in Pakistan, tax is unchanged up to Rs. 2,200,000, and higher earners pay less than last year because the 23%, 30%, and 35% rates were cut or pushed to higher income levels. Check the income tax line on your payslip against the tables above; if it differs noticeably, ask payroll how your annual taxable salary was estimated.
This article is general information, not tax advice. Figures are based on the Finance Act, 2026 as widely reported; confirm against FBR publications or consult a tax professional for your situation.