Salary Tax Calculator Pakistan 2026-27
Free FBR salary income tax calculator for 2026-27. Income tax is FEDERAL (the same slabs nationwide); what changes by province is the minimum wage and the EOBI base. Enter your monthly salary, see your net take-home, taxable vs exempt allowances, sales tax, withholding tax and EOBI — every figure cites its legal clause.
Enter your basic salary, then add each allowance and pick its type. The calculator shows which part of every allowance is taxable and which is exempt, with the clause it relies on.
| Head | Amount /mo | Exempt /mo | Taxable /mo | Why |
|---|---|---|---|---|
| Basic salary | Rs 125,000 | — | Rs 125,000 | Fully taxable |
| House Rent Allowance | Rs 56,250 | — | Rs 56,250 | Fully taxable (no general HRA exemption in Pakistan) |
| Medical Allowance | Rs 18,000 | Rs 12,500 | Rs 5,500 | Exempt up to 10% of basic (Rs 12,500) [Clause 139(b)] |
Applicable slab: Rs 2,200,001 – 3,200,000 — Rs 116,000 + 20% of the amount exceeding Rs 2,200,000.
Issuing department: Federal Board of Revenue (FBR). Income tax: Income Tax Ordinance 2001, First Schedule, Part I, Division I (salaried individuals), as amended by the Finance Act 2026 (Federal Budget 2026-27), effective 1 July 2026. Medical allowance: Clause (139), Part I of the Second Schedule (unchanged by the Finance Act 2026). Provident fund: Sixth Schedule, Part I.
EOBI (employee 1% / employer 5% of minimum wage): Employees’ Old-Age Benefits Act 1976, administered by EOBI (Ministry of Overseas Pakistanis & HRD). Minimum wage: provincial Labour & Human Resource Department notifications, effective 1 July 2025 (FY 2025-26).
Federal salary income tax slabs 2026-27
| Annual taxable salary | Tax |
|---|---|
| Up to Rs 600,000 | 0% |
| 600,001 – 1,200,000 | 1% of amount over 600,000 |
| 1,200,001 – 2,200,000 | 6,000 + 11% over 1,200,000 |
| 2,200,001 – 3,200,000 | 116,000 + 20% over 2,200,000 |
| 3,200,001 – 4,100,000 | 316,000 + 25% over 3,200,000 |
| 4,100,001 – 5,600,000 | 541,000 + 29% over 4,100,000 |
| 5,600,001 – 7,000,000 | 976,000 + 32% over 5,600,000 |
| Above 7,000,000 | 1,424,000 + 35% over 7,000,000 |
References: Finance Bill 2026 (Federal Budget 2026-27), Income Tax Ordinance 2001 — First Schedule, Part I, Division I, clause (2); FBR Salient Features 2026-27. Minimum wage: current provincial notifications (Punjab, Sindh, KP: Rs 40,000; Balochistan, ICT: Rs 37,000), with the federal budget 2026-27 proposing Rs 40,700. EOBI: 5% employer + 1% employee of the notified minimum wage.
Pakistan salary tax — frequently asked questions
How is income tax on salary calculated in Pakistan for 2026-27?
Salary income tax is federal and progressive. For 2026-27 (Finance Act 2026) it is 0% up to Rs 600,000 a year, then 1%, 11%, 20%, 25%, 29%, 32% and 35% on higher slabs. Enter your monthly salary and the calculator applies the exact FBR slab to your annual taxable income.
How much tax will I pay on a Rs 100,000 monthly salary in Pakistan?
A Rs 100,000 monthly salary is Rs 1,200,000 a year. The first Rs 600,000 is tax-free; the next Rs 600,000 is taxed at 1% = Rs 6,000 a year, i.e. about Rs 500 a month. Structuring up to 10% of basic as medical allowance can reduce taxable income further.
Which salary allowances are tax exempt in Pakistan?
Most allowances (house rent, conveyance, utilities) are fully taxable. The main exemption is medical allowance, exempt up to 10% of basic salary, provided free medical treatment or insurance is not separately given (Clause 139). Employer provident-fund contributions are also exempt up to the lower of 10% of basic or Rs 150,000 a year.
How can I legally reduce tax on my salary in Pakistan?
The realistic lever is structuring up to 10% of basic salary as a medical allowance, which is exempt. The calculator’s optimiser shows your tax with and without structuring and the saving, citing the clause that allows it. Becoming a tax filer also lowers withholding tax rates on banking, property and vehicles.
Is medical allowance taxable in Pakistan?
Medical allowance is exempt up to 10% of basic salary under Clause 139 of the Second Schedule, as long as the employer does not also provide free medical treatment or reimbursement. Any amount above 10% of basic is taxable.
What is the difference between a filer and a non-filer in Pakistan?
A filer is on the FBR Active Taxpayers List (ATL) because they file their annual income tax return. Non-filers pay sharply higher withholding/advance tax on banking transactions, property, vehicles and dividends. Salary tax slabs are the same, but filing makes every other tax cheaper.
What is the sales tax (GST) rate in Pakistan in 2026-27?
Sales tax on goods is federal at a standard 18%. Sales tax on services is provincial — 16% in Punjab (PRA), 15% in Sindh (SRB), KP (KPRA) and Balochistan, and 16% in Islamabad, with telecom at 19.5%.
What is EOBI and how much is the contribution?
EOBI is the Employees’ Old-Age Benefits Institution scheme. The contribution is 5% by the employer and 1% by the employee, calculated on the notified minimum wage, giving the worker a pension on retirement.
What is the minimum wage in Pakistan in 2026?
Current provincial minimum wage is Rs 40,000 in Punjab, Sindh and KP, and Rs 37,000 in Balochistan and Islamabad. The federal budget 2026-27 proposes Rs 40,700. The EOBI base follows the notified minimum wage.
Are bonus and overtime taxable in Pakistan?
Yes. Bonus, overtime, commission and most cash allowances are part of taxable salary and are taxed at your applicable slab. They are added to annual taxable income before the FBR slabs are applied.
What is withholding tax on salary in Pakistan?
Under Section 149 the employer deducts income tax from salary every month and deposits it with the FBR — this is the withholding tax on salary. It is your normal slab tax spread across 12 months, not an extra charge.
Is this salary tax calculator free and accurate?
Yes — it is 100% free, needs no sign-up, and uses the exact 2026-27 FBR slabs, EOBI rates and province-wise minimum wage, with every figure citing its legal clause (Income Tax Ordinance 2001, Finance Act 2026). It is built by Zaffre Tech, the makers of the Zaffre Axon payroll platform.
Stop calculating salary tax by hand.
Zaffre HRM — the payroll module of the Zaffre Axon platform by Zaffre Tech — applies these FBR slabs and EOBI automatically on every payroll run, for your whole team.
Last updated: 16 June 2026 · Built by Zaffre Tech (Zaffre Axon)