Last updated: 7 November 2026 (Asia/Karachi). Salary slabs checked against FBR Circular No. 02 of 2026-27 (8 September 2026), the Income Tax Ordinance 2001 as amended up to 30 June 2026, and the FBR Withholding Tax Rate Card for Tax Year 2027. Confirm any edge case on the latest FBR circular or with a registered tax adviser before you file.
The current income tax salary slabs for salaried individuals in Pakistan come from Finance Act 2026 (tax year 2027 / financial year 2026-27). The zero band still starts at Rs. 600,000 of taxable income. Marginal rates on salary income now run from 1% to 35%, and the old 9% surcharge on salaried people with taxable income above Rs. 10 million has been withdrawn. Non-salaried individuals and associations of persons (AOPs) keep a different table, and their 10% surcharge above Rs. 10 million still applies.
In this guide
Who uses the income tax salary slabs
The income tax salary slabs apply only to salaried people. Clause (2) of Division I, Part I of the First Schedule applies when an individual’s income chargeable under the head “salary” exceeds seventy-five percent of that person’s taxable income. Everyone else who is an individual or an AOP uses the clause (1) table, unless a special regime applies. Residents are taxed on worldwide income. Non-residents are taxed on Pakistan-source income. Salary is Pakistan-source when the employment is exercised in Pakistan, even if the employer pays from abroad.
Income tax salary slabs after Finance Act 2026
The table below shows the income tax salary slabs now in force. FBR Circular No. 02 of 2026-27 explains that Finance Act 2026 substituted the salary-rate table to cut rates across several bands. The live table in the Ordinance (amended up to 30 June 2026) and the Tax Year 2027 withholding card match the rows below.
| Taxable income (PKR) | Rate of tax |
|---|---|
| Does not exceed 600,000 | 0% |
| Exceeds 600,000 but does not exceed 1,200,000 | 1% of the amount exceeding 600,000 |
| Exceeds 1,200,000 but does not exceed 2,200,000 | Rs. 6,000 + 11% of the amount exceeding 1,200,000 |
| Exceeds 2,200,000 but does not exceed 3,200,000 | Rs. 116,000 + 20% of the amount exceeding 2,200,000 |
| Exceeds 3,200,000 but does not exceed 4,100,000 | Rs. 316,000 + 25% of the amount exceeding 3,200,000 |
| Exceeds 4,100,000 but does not exceed 5,600,000 | Rs. 541,000 + 29% of the amount exceeding 4,100,000 |
| Exceeds 5,600,000 but does not exceed 7,000,000 | Rs. 976,000 + 32% of the amount exceeding 5,600,000 |
| Exceeds 7,000,000 | Rs. 1,424,000 + 35% of the amount exceeding 7,000,000 |
These income tax salary slabs replace the older 2024-25 and 2025-26 salary tables that many blogs still show. Always use the Ordinance table or the latest FBR rate card for the tax year you are filing.
Non-salary individual and AOP tax rates
Subject to the salary rule above, every individual and association of persons pays tax under clause (1) of Division I. The Finance Act 2024 table (still in the Ordinance as amended to 30 June 2026) is:
| Taxable income (PKR) | Rate of tax |
|---|---|
| Does not exceed 600,000 | 0% |
| Exceeds 600,000 but does not exceed 1,200,000 | 15% of the amount exceeding 600,000 |
| Exceeds 1,200,000 but does not exceed 1,600,000 | Rs. 90,000 + 20% of the amount exceeding 1,200,000 |
| Exceeds 1,600,000 but does not exceed 3,200,000 | Rs. 170,000 + 30% of the amount exceeding 1,600,000 |
| Exceeds 3,200,000 but does not exceed 5,600,000 | Rs. 650,000 + 40% of the amount exceeding 3,200,000 |
| Exceeds 5,600,000 | Rs. 1,610,000 + 45% of the amount exceeding 5,600,000 |
For a professional firm that is an AOP and is prohibited from incorporating by law or by its professional rules, the 45% rate against the top band is capped at 40%. Lawyers and some other regulated practices often sit in that proviso. Confirm the firm’s governing rules before you rely on the 40% cap.
Surcharge and pension notes
The surcharge sits on top of the income tax salary slabs for some people. Section 4AB still charges a 10% surcharge on income tax under Division I when taxable income exceeds Rs. 10 million for individuals and AOPs who are not salaried for that purpose. Finance Act 2026 withdrew the separate 9% surcharge that used to apply to salaried individuals above that threshold. Circular No. 02 of 2026-27 states that point plainly.
Pension is not taxed under the income tax salary slabs. Pension from a former employer has its own rate table in the Ordinance and on the Tax Year 2027 withholding card. Broadly, pension up to Rs. 10 million is shown at 0% in the card’s section 149(IA) rows; amounts above that for recipients under 70 follow the card’s 5% plus surcharge line. Read the Ordinance table before treating any pension as fully exempt.
Quick worked example (salary table only)
Here is how the income tax salary slabs work in practice. Suppose a salaried resident has taxable income of Rs. 2,500,000 and more than 75% of that income is salary. Tax under the Finance Act 2026 salary table is:
- First Rs. 600,000: Rs. 0
- Next Rs. 600,000 (to 1,200,000): 1% = Rs. 6,000
- Next Rs. 1,000,000 (to 2,200,000): 11% = Rs. 110,000 (running total Rs. 116,000)
- Remaining Rs. 300,000 above 2,200,000: 20% = Rs. 60,000
- Income tax before any credits or surcharge: Rs. 176,000
Because the person is salaried and taxed under the income tax salary slabs, the old 9% surcharge above Rs. 10 million does not apply to them after Finance Act 2026. This example ignores rebates, reductions, and final-tax items.
What employers withhold
Employers deduct tax under section 149 using the same income tax salary slabs, the Division I salary table,, as shown on FBR’s Withholding Tax Rate Card for Tax Year 2027. Active-taxpayer status can still change rates on many other payment types (services, contracts, supplies), but the salary rows themselves follow the table above. Pay-slip tax is an advance against your annual liability, not always the final bill.
Official sources to re-check
- FBR Circular No. 02 of 2026-27 (salary-rate relief and salaried surcharge withdrawal)
- FBR Finance Act 2026 page and the linked Finance Act PDF
- Income Tax Ordinance, 2001 (amended up to 30 June 2026)
- FBR Withholding Tax Rate Cards (Tax Year 2027 card)
- Related on this site: FBR tax conditions for overseas Pakistanis and NADRA tax data sharing with FBR
FAQ
What are the income tax salary slabs after Finance Act 2026?
For salaried individuals (salary more than 75% of taxable income), tax is 0% up to Rs. 600,000, then 1%, then Rs. 6,000 + 11%, Rs. 116,000 + 20%, Rs. 316,000 + 25%, Rs. 541,000 + 29%, Rs. 976,000 + 32%, and Rs. 1,424,000 + 35% on the top band above Rs. 7,000,000, as set out in Circular No. 02 of 2026-27 and the Ordinance.
Do AOPs use the same table as salaried employees?
No. Non-salaried individuals and AOPs use the clause (1) table, which still tops out at 45% (40% for certain professional firms). Only people who meet the salary 75% test use the lower income tax salary slabs.
Is the surcharge on high income still there for salaried people?
Finance Act 2026 withdrew the 9% surcharge that applied to salaried individuals when taxable income exceeded Rs. 10 million. The 10% surcharge for other individuals and AOPs above that threshold continues.
Which tax year do these income tax salary slabs cover?
They apply after Finance Act 2026. FBR’s matching withholding card is labelled Tax Year 2027 (updated up to 30 June 2026). Use the card and Ordinance for the year you are filing, not older 2024-25 blog tables.
Where can I read the law myself?
Start with FBR Circular No. 02 of 2026-27 for the salary-rate explanation, then the Income Tax Ordinance 2001 PDF amended up to 30 June 2026, and the Tax Year 2027 withholding rate card on fbr.gov.pk.
Does employer deduction settle my full tax?
Not always. Section 149 withholding follows the salary table, but rebates, other income heads, and final-tax items can change the year-end position. File on the basis of the Ordinance, not the payslip alone.
