Filing now? FBR has extended the deadline for Tax Year 2026 returns to October 15, 2026. After that date, getting back onto the Active Taxpayers List costs individuals Rs 25,000.
Salaried people in Pakistan pay no income tax on the first Rs 600,000 of taxable salary a year, then rates rise from 1% to 35%. For Tax Year 2027 (July 2026 to June 2027), the Finance Act 2026 cut the rates on salaries above Rs 2.2 million and removed the 9% surcharge on high salaries. This guide covers both tax years, so you can file last year's return and plan this year's withholding.
Want your number straight away? Use our Pakistan Income Tax Calculator. It supports both tax years.
Key Dates
| Tax year | Period covered | Return due |
|---|---|---|
| Tax Year 2026 | July 1, 2025 – June 30, 2026 | October 15, 2026 (extended from September 30) |
| Tax Year 2027 | July 1, 2026 – June 30, 2027 | September 30, 2027 |
Your employer deducts tax from your salary every month for the current tax year. You file the return for the year that has just ended. So in October 2026 you are filing Tax Year 2026 while tax for Tax Year 2027 is being deducted from your pay.
Salary Tax Slabs for Tax Year 2027 (2026-27)
These rates apply when salary is more than 75% of your taxable income. They come from FBR's withholding tax rate card, updated to June 30, 2026 under the Finance Act 2026.
| Annual taxable salary (Rs) | Tax |
|---|---|
| Up to 600,000 | 0% |
| 600,001 – 1,200,000 | 1% of the amount above 600,000 |
| 1,200,001 – 2,200,000 | 6,000 + 11% of the amount above 1,200,000 |
| 2,200,001 – 3,200,000 | 116,000 + 20% of the amount above 2,200,000 |
| 3,200,001 – 4,100,000 | 316,000 + 25% of the amount above 3,200,000 |
| 4,100,001 – 5,600,000 | 541,000 + 29% of the amount above 4,100,000 |
| 5,600,001 – 7,000,000 | 976,000 + 32% of the amount above 5,600,000 |
| Above 7,000,000 | 1,424,000 + 35% of the amount above 7,000,000 |
There is no surcharge on salary income in Tax Year 2027.
Salary Tax Slabs for Tax Year 2026 (2025-26)
Use these if you are filing your Tax Year 2026 return now. They come from FBR's rate card under the Finance Act 2025.
| Annual taxable salary (Rs) | Tax |
|---|---|
| Up to 600,000 | 0% |
| 600,001 – 1,200,000 | 1% of the amount above 600,000 |
| 1,200,001 – 2,200,000 | 6,000 + 11% of the amount above 1,200,000 |
| 2,200,001 – 3,200,000 | 116,000 + 23% of the amount above 2,200,000 |
| 3,200,001 – 4,100,000 | 346,000 + 30% of the amount above 3,200,000 |
| Above 4,100,000 | 616,000 + 35% of the amount above 4,100,000 |
If your taxable income was above Rs 10 million, a 9% surcharge is added on top of the tax worked out above.
What Changed Between the Two Years
- Up to Rs 2.2 million a year (about Rs 183,000 a month): nothing changed. You pay the same tax in both years.
- Rs 2.2 – 3.2 million: the rate on this slab fell from 23% to 20%.
- Rs 3.2 – 4.1 million: the rate fell from 30% to 25%.
- Above Rs 4.1 million: the single 35% slab was split into 29%, 32% and 35%. The 35% rate now starts at Rs 7 million.
- Surcharge: the 9% surcharge on salaried income above Rs 10 million was removed.
How Much Tax on Your Salary? Worked Examples
| Monthly salary (Rs) | Annual tax, TY 2027 (Rs) | Monthly deduction, TY 2027 (Rs) | Annual tax, TY 2026 (Rs) |
|---|---|---|---|
| 50,000 | 0 | 0 | 0 |
| 100,000 | 6,000 | 500 | 6,000 |
| 150,000 | 72,000 | 6,000 | 72,000 |
| 200,000 | 156,000 | 13,000 | 162,000 |
| 300,000 | 416,000 | 34,667 | 466,000 |
| 500,000 | 1,104,000 | 92,000 | 1,281,000 |
How the Rs 200,000 a month figure is worked out for Tax Year 2027:
- Annual salary: 200,000 × 12 = Rs 2,400,000, which falls in the Rs 2,200,001 – 3,200,000 slab
- Fixed tax for the slab: Rs 116,000
- 20% of the amount above Rs 2,200,000: 20% × 200,000 = Rs 40,000
- Total: Rs 156,000 a year, or Rs 13,000 a month. Your effective rate is 6.5%, even though your top rate is 20%.
These examples assume your whole taxable income is salary, with no other income or tax credits.
Who Has to File a Return
- Anyone whose taxable income is above Rs 600,000 for the year must file.
- Some people must file even below that, for example because of property, vehicles or other conditions listed in section 114 of the Income Tax Ordinance 2001. If you own significant assets, check FBR's list before deciding not to file.
- Filing is worth it even when it isn't required, because it puts you on the Active Taxpayers List (ATL).
Along with the return, individuals file a wealth statement: a list of your assets and liabilities at the end of the tax year, which has to reconcile with your income and spending.
Filer vs Non-Filer: What It Costs You
Being on the ATL does not change your salary tax slab, but it changes almost everything else:
- Cash withdrawals: non-filers pay 0.8% advance tax on cash withdrawals. Filers pay nothing.
- Other withholding taxes: non-filers generally pay double the filer rate on things like property purchases, vehicle registration and dividends.
- Getting back on the ATL after the deadline: under the Finance Act 2026, individuals who file late must pay Rs 25,000 to be restored to the ATL, up from Rs 1,000.
For most salaried people, filing on time is the cheapest option by far.
How to File Your Return on IRIS
Step 1: Register (first-time filers only)
Register on FBR's IRIS portal with your CNIC, mobile number and email address. FBR sends a password and PIN that you'll use to log in and submit.
Step 2: Collect your documents
You need your salary certificate from your employer (it shows salary paid and tax deducted), bank statements or certificates showing profit and tax deducted, and records of other tax you paid during the year. That includes tax on mobile phone bills, electricity bills, vehicle registration and token tax.
Step 3: Fill in the return of income
Open the return for the correct tax year (Tax Year 2026 if you're filing now). Enter your salary and the tax your employer deducted. Then add any other income, such as bank profit, rent or freelance income, plus every other tax you paid during the year.
Step 4: Complete the wealth statement
List your assets (property, vehicles, bank balances, investments, cash) and liabilities at June 30. The increase in your net wealth over the year should match your income minus your living expenses. IRIS flags it if it doesn't.
Step 5: Pay any balance and submit
If you owe more than was deducted, generate a payment slip (PSID) in IRIS and pay it through your bank before you submit. If more tax was deducted than you owe, the return shows the refundable amount, and you can claim the refund through IRIS.
FBR's Tax Asaan mobile app also lets salaried individuals file a simple return from their phone.
Taxes You Can Adjust Against Your Liability
Many salaried people overpay because they forget tax they've already paid. Keep the receipts, because these are often adjustable against your final tax:
- Tax deducted on mobile phone and internet bills
- Tax collected on electricity bills above certain thresholds
- Tax collected at vehicle registration and in annual token tax
- Tax deducted on bank profit (check whether it's a final or adjustable tax for your case)
If your employer didn't know about other income or tax you paid, you can give them the details. They will then adjust your monthly deduction for the rest of the year.
Common Mistakes to Avoid
- Filing for the wrong tax year. In October 2026 you are filing Tax Year 2026 (July 2025 – June 2026), not 2027.
- Using the wrong year's slabs. Rates above Rs 2.2 million changed on July 1, 2026, so check which year's table you're using.
- A wealth statement that doesn't reconcile. Unexplained increases in assets are the most common reason for FBR notices.
- Missing the deadline. Re-entering the ATL now costs Rs 25,000, so file by October 15.
Sources
- FBR, Withholding Tax Rate Card for Tax Year 2027 (updated to June 30, 2026 as per Finance Act 2026)
- FBR, Withholding Tax Rate Card (updated to June 30, 2025 as per Finance Act 2025)
- Dawn, FBR extends deadline for filing income tax returns to Oct 15 (September 30, 2026)
This guide explains the general rules for salaried individuals. Your own liability depends on all your income, allowances and credits. For complex situations, speak to a qualified tax adviser.