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Pakistan Salary Tax Slabs & Income Tax Rates Master Guide (2021–2026)

Pakistan Salary Tax Slabs & Income Tax Rates Master Guide (2021–2026)

By Farhan Ahmed, Personal Tax Advisory LeadLast updated: September 202620 min read
Statutory source alignment verified for September 2026 by Farhan Ahmed, Personal Tax Advisory Lead (Statutory Research)

Executive Summary

Navigating pakistan income tax, income tax in pakistan 2022, and current FBR tax schedules requires a detailed breakdown of pakistan salary tax rules under the Income Tax Ordinance, 2001. Whether you are seeking information on the minimum salary for income tax in pakistan (PKR 600,000 tax-free limit), calculating income tax deduction on salary in pakistan 2022 23, or comparing historical fbr salary tax slabs 2021 22 pakistan with current assessment years, this master guide provides complete legal clarity.

1. Overview of Personal Income Tax & Salary Slabs Evolution (2021–2026)

The Federal Board of Revenue (FBR) enforces progressive taxation under Section 12 (Salary Income) and First Schedule of the Income Tax Ordinance. The current income tax rate in pakistan and current tax slab for salaried person in pakistan apply exclusively to individuals where salary constitutes more than 75% of total taxable income.

Understanding the historical trajectory of income tax slab 2021 22 pakistan, budget 2022 23 pakistan income tax, and income tax rate in pakistan 2022 23 helps taxpayers evaluate back-tax assessments, revised filings, and payroll adjustments:

Annual Taxable Salary BracketBudget 2021–22 SlabsBudget 2022–23 SlabsCurrent Assessment (2025–26)
Up to PKR 600,0000%0%0% (Tax-Free Limit)
PKR 600,001 – 1,200,0005% exceeding 600KPKR 100 + 2.5% exceeding 600K5% of amount exceeding 600K
PKR 1,200,001 – 2,400,000PKR 30K + 10% exceeding 1.2MPKR 15K + 12.5% exceeding 1.2MPKR 30,000 + 15% exceeding 1.2M
PKR 2,400,001 – 3,600,000PKR 150K + 15% exceeding 2.4MPKR 165K + 17.5% exceeding 2.4MPKR 210,000 + 25% exceeding 2.4M
PKR 3,600,001 – 4,100,000PKR 330K + 17.5% exceeding 3.6MPKR 375K + 22.5% exceeding 3.6MPKR 510,000 + 30% exceeding 3.6M
Above PKR 4,100,000Up to 22.5% – 32.5%Up to 32.5% + SurchargePKR 660,000 + 35% exceeding 4.1M

Official statutory schedules can be cross-verified on the Federal Board of Revenue (FBR) Official Site.

2. Minimum Salary for Income Tax & Non-Taxable Income Limits

A fundamental topic for employees and payroll managers across Pakistan is the minimum income for tax in pakistan and minimum salary for tax in pakistan:

PKR 600,000
Annual Tax-Free Limit
Tax rate is 0% up to PKR 600,000 per tax year
PKR 50,000
Monthly Threshold
No monthly salary withholding if pay <= 50K
10%
Medical Allowance Exemption
Exempt up to 10% of basic pay under Clause 139

Any total annual earnings below PKR 600,000 are classified as non taxable income in pakistan. However, salaried workers earning above PKR 600,000 MUST file an annual income tax return on FBR Iris to remain on the Active Taxpayer List (ATL).

3. Special Salary Provisions: Pensions, Disabled Persons & Non-Residents

Specific categories of salaried taxpayers receive specialized treatment under the Income Tax Ordinance:

Income Tax on Pension in Pakistan

Under Clause 80 of Part I of the Second Schedule, pension received by a citizen of Pakistan from a former employer (government or private approved pension fund) is 100% exempt from income tax.

Income Tax for Disabled Persons in Pakistan

Taxpayers holding a official disability certificate certified by the National Database and Registration Authority (NADRA) or Ministry of National Health Services qualify for statutory tax concessions and higher exemption thresholds on salaried income.

Income Tax for Non-Resident Pakistanis (NRPs)

Under Section 82 of the Income Tax Ordinance, an individual residing outside Pakistan for 183 days or more in a tax year is deemed a Non-Resident. Foreign-source salary earned by an NRP abroad is completely exempt from Pakistan income tax.

4. Practical Step-by-Step Monthly Salary Tax Calculation

Consider a corporate employee in Lahore earning a monthly gross salary of PKR 150,000 (Basic Salary: PKR 100,000, Medical Allowance: PKR 10,000, House Rent Allowance: PKR 40,000).

Annual Gross Pay (150,000 × 12)PKR 1,800,000
Less: Exempt Medical Allowance (10% of 100K × 12)− PKR 120,000
Net Annual Taxable SalaryPKR 1,680,000
FBR Tax Calculation (Slab: 1.2M – 2.4M @ 15%)PKR 30,000 + 15% of (1,680,000 − 1,200,000)
Total Annual Salary Tax PayablePKR 102,000
Monthly Deducted Salary Tax (Section 149)PKR 8,500 / month

Calculate Your Monthly Salary Tax Instantly

Calculate your exact monthly salary tax deductions, take-home pay, and FBR tax slab liability using our free online calculators.

Open Salary Tax Calculator →Open Income Tax Calculator

5. Frequently Asked Questions (FAQs)

What is the minimum taxable income and salary limit for income tax in Pakistan?↓

For salaried individuals in Pakistan, the minimum taxable income threshold is PKR 600,000 per year (PKR 50,000 per month). Any annual salary up to PKR 600,000 is taxed at 0% under FBR statutory slabs.

How have FBR salary tax slabs evolved from Budget 2021–22 & 2022–23 to 2025–2026?↓

In Budget 2021-22 and 2022-23, FBR maintained progressive tax slabs ranging from 0% to 32.5%. Under recent Finance Acts (2024-2026), salary tax slabs range from 0% to 35% with revised surcharge rates for high-income earners exceeding PKR 10 million annually.

How is monthly salary tax deduction calculated in Pakistan under Section 149?↓

Employers estimate total annual taxable salary (after exempt medical allowance up to 10% of basic salary), apply the statutory FBR progressive tax slab, and divide the total annual tax by 12 to deduct monthly withholding tax.

Are pensions and senior citizen salaries exempt from income tax in Pakistan?↓

Government pensions and approved private gratuity/pension funds are exempt from income tax under Clause 80 of Part I of the Second Schedule. Senior citizens (aged 60+) and disabled persons previously enjoyed tax rebates under FBR rules.

How does income tax apply to non-resident Pakistanis (NRPs)?↓

Non-Resident Pakistanis are taxed under Section 114 only on Pakistan-source income (such as local rental income or business profits). Salary earned abroad by non-residents is fully exempt from Pakistan income tax.

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