# Salary tax calculator 2026-27: your monthly tax under the new slabs

URL: https://which.pk/business/tools/salary-tax-calculator/
Author: Hassam Imtiaz
Updated: 13 Oct 2026

## Summary

Enter a monthly or yearly salary and the calculator applies the 2026-27 salaried slabs from FBR's Income Tax Ordinance. Salary up to Rs 50,000 a month is tax-free, Rs 1 lakh a month pays Rs 500 and Rs 3 lakh pays Rs 34,667. The Finance Act 2026 cut the rates between Rs 22 lakh and Rs 70 lakh a year and removed the 9% surcharge on salary, so anyone earning more than Rs 22 lakh a year pays less than in 2025-26.

## Key facts

- Tax-free salary: Rs 50,000 a month
- Top rate: 35% above Rs 70 lakh a year
- Surcharge on salary: None from July 2026
- Applies to: Jul 2026 to Jun 2027

This salary tax calculator uses FBR's 2026-27 slabs for salaried people (tax year 2027, July 2026 to June 2027). **Salary up to Rs 50,000 a month is tax-free.** Rs 1.5 lakh a month pays **Rs 6,000 a month**, the same as last year. Rs 3 lakh a month pays **Rs 34,667**, down from Rs 38,833, because the Finance Act 2026 cut the rates above Rs 22 lakh a year.

## What are the salary tax slabs for 2026-27?

These are the rates in the First Schedule of the Income Tax Ordinance, as amended up to 30 June 2026, for anyone whose salary is more than 75% of their taxable income. FBR's withholding rate card for tax year 2027 lists the same eight slabs. For a plain list with more detail, see [income tax slabs for 2026-27](/business/guides/income-tax-slabs-2026-27/).

| Yearly taxable salary | Tax in 2026-27 | Rate on this slab in 2025-26 |
|---|---|---|
| Up to Rs 6 lakh | 0% | 0% |
| Rs 6 lakh to Rs 12 lakh | 1% of the amount above Rs 6 lakh | 1% |
| Rs 12 lakh to Rs 22 lakh | Rs 6,000 + 11% above Rs 12 lakh | 11% |
| Rs 22 lakh to Rs 32 lakh | Rs 1,16,000 + **20%** above Rs 22 lakh | 23% |
| Rs 32 lakh to Rs 41 lakh | Rs 3,16,000 + **25%** above Rs 32 lakh | 30% |
| Rs 41 lakh to Rs 56 lakh | Rs 5,41,000 + **29%** above Rs 41 lakh | 35% |
| Rs 56 lakh to Rs 70 lakh | Rs 9,76,000 + **32%** above Rs 56 lakh | 35% |
| Above Rs 70 lakh | Rs 14,24,000 + 35% above Rs 70 lakh | 35% |

Each rate applies only to the part of your salary inside that slab. Crossing into a higher slab never makes your whole salary taxed at the higher rate.

## How much tax on salary per month in Pakistan?

Worked out from the slabs above, for a salary that stays the same all year with no bonus or tax-free allowance.

| Monthly salary | Tax a month, 2026-27 | Tax a month, 2025-26 | Take-home a month, 2026-27 |
|---|---|---|---|
| Rs 50,000 | Rs 0 | Rs 0 | Rs 50,000 |
| Rs 1 lakh | Rs 500 | Rs 500 | Rs 99,500 |
| Rs 1.5 lakh | Rs 6,000 | Rs 6,000 | Rs 1,44,000 |
| Rs 2 lakh | Rs 13,000 | Rs 13,500 | Rs 1,87,000 |
| Rs 2.5 lakh | Rs 23,000 | Rs 25,000 | Rs 2,27,000 |
| Rs 3 lakh | Rs 34,667 | Rs 38,833 | Rs 2,65,333 |
| Rs 4 lakh | Rs 62,000 | Rs 71,750 | Rs 3,38,000 |
| Rs 5 lakh | Rs 92,000 | Rs 1,06,750 | Rs 4,08,000 |
| Rs 10 lakh | Rs 2,64,500 | Rs 3,07,108 | Rs 7,35,500 |

The 2025-26 figure for Rs 10 lakh a month includes the 9% surcharge that applied then above Rs 1 crore a year. These figures match KPMG's comparison of the old and new tax at every salary KPMG lists.

## How does the calculator work out your tax?

Section 149 of the Ordinance tells your employer to deduct tax from each salary payment at your average rate. That rate comes from your estimated salary for the whole tax year. The calculator does the same: it spreads the year's tax evenly over 12 months. How your employer handles a mid-year raise or a bonus depends on its payroll practice, so ask HR.

The "average rate" in the result is your year's tax divided by your taxable salary. The "top slab" is the rate on your last rupee, which is the rate a raise is taxed at.

## What counts as taxable salary?

Under section 12, salary is more than basic pay. It includes:

- pay, leave pay, overtime, bonus, commission, fees and gratuity
- perks, whether paid in cash or not
- allowances such as house rent, utilities, cost of living, education, entertainment and travel

A fixed allowance paid every month, or one set as a percentage of salary, counts as salary even if it is called a travel allowance. Add these to the figure you enter.

One common allowance is tax-free. Medical allowance up to 10% of basic pay is exempt under clause 139 of the Second Schedule, but only if your employer doesn't give free medical treatment or pay back your medical bills. The calculator's optional box takes this amount and removes it before applying the slabs.

## What changed from 2025-26?

Finance Minister Muhammad Aurangzeb announced the cuts in the budget speech on 12 June 2026, as reported by APP, The News and Dawn. The Finance Act 2026 kept them, and FBR's Ordinance amended to 30 June 2026 prints the new table.

- **Four rates cut.** 23% became 20%, 30% became 25%, and 35% became 29% or 32%, depending on the slab.
- **35% starts later.** The top rate now starts above Rs 70 lakh a year instead of Rs 41 lakh. There are now eight slabs instead of six.
- **No surcharge on salary.** Section 4AB added a 10% surcharge for incomes above Rs 1 crore in 2024. The Finance Act 2025 cut it to 9% for salaried people, and the Finance Act 2026 removed it for them.
- **Nothing changed up to Rs 22 lakh a year** (about Rs 1.83 lakh a month). If you earn less than that, your tax is the same as last year.

KPMG puts the saving at Rs 30,000 a year on Rs 32 lakh, Rs 1,65,000 on Rs 56 lakh and Rs 5,11,290 on Rs 1.2 crore.

## When don't these slabs apply?

**Salary must be more than 75% of your taxable income:** If you also earn from a business, freelancing or rent and salary is 75% or less of your taxable income, the non-salaried table applies to you instead. It charges 15% from the first rupee above Rs 6 lakh and rises to 45% above Rs 56 lakh. See [tax for freelancers](/business/guides/freelancer-tax-pakistan/).

- **Pension from a former employer** has its own rate: 0% up to Rs 1 crore a year and 5% on the amount above that. FBR's rate card adds a 10% surcharge on that tax if you are under 70.
- **Teachers and researchers** at recognised non-profit institutions used to get 25% off their tax. That reduction ended after tax year 2025, so the calculator doesn't include it.

## Can you lower the tax your employer deducts?

Yes, in two ways that section 149 names. Your employer must adjust the deduction for tax credits under section 61 (charitable donations) and section 63 (contributions to an approved pension fund under the Voluntary Pension System), once you give proof. See [pension funds in Pakistan](/money/guides/pension-fund-pakistan/).

Your employer must also adjust for tax already taken from you under other heads during the year. Ask your HR or payroll team what proof they need.

Tax taken from salary is adjustable, not final: it counts towards the tax worked out on your return, which is due by 30 September after the tax year ends. See [how to file your income tax return](/business/guides/how-to-file-income-tax-return/) and [filer vs non-filer](/business/guides/filer-vs-non-filer/). FBR's rate card shows no separate salary rate for people missing from the Active Taxpayers List (ATL).

More guides: [income tax slabs 2026-27](/business/guides/income-tax-slabs-2026-27/) · [how to become a filer](/business/guides/how-to-become-filer/) · [how to check your filer status](/business/guides/how-to-check-filer-status/) · [pension funds](/money/guides/pension-fund-pakistan/) · [life insurance](/money/guides/life-insurance-pakistan/) · [investment options compared](/money/guides/investment-options-pakistan/)

## Questions people ask

### How much tax is deducted from a salary of Rs 1 lakh a month?

Rs 500 a month. Rs 12 lakh a year falls in the 1% slab, so the tax is 1% of Rs 6 lakh, Rs 6,000 a year, the same as in 2025-26.

### Is there a surcharge on salary in 2026-27?

No. The Finance Act 2026 removed the 9% surcharge for income taxed as salary. It still applies at 10% to business individuals and AOPs with taxable income above Rs 1 crore.

### What is the tax-free salary limit in 2026-27?

Rs 6 lakh a year, which is Rs 50,000 a month. Above that, the first slab is 1%.

### Do these slabs apply if I also have business or rental income?

Only if salary is more than 75% of your taxable income. Otherwise the non-salaried table applies, which charges 15% on income above Rs 6 lakh.

## Sources

- [Income Tax Ordinance, 2001 (amended up to 30.06.2026)](https://download1.fbr.gov.pk/Docs/2026724177725705IncomeTaxOrdinanace2001.pdf), FBR (accessed 13 Oct 2026)
- [Withholding Income Tax Rate Card, Tax Year 2027 (updated up to 30 June 2026)](https://download1.fbr.gov.pk/Docs/202681113864992WithholdingTaxRatesCard2027.pdf), FBR (accessed 13 Oct 2026)
- [A Brief of Finance Act, 2026 (July 2026)](https://assets.kpmg.com/content/dam/kpmgsites/pk/pdf/2026/07/A%20Brief%20of%20Finance%20Act%202026.pdf.coredownload.inline.pdf), KPMG Taseer Hadi & Co. (accessed 13 Oct 2026)
- [FY2027 budget proposes lower tax rates for salaried workers (12 June 2026)](https://www.thenews.pk/story/1420208-fy2027-budget-proposes-lower-tax-rates-for-salaried-workers), The News (accessed 13 Oct 2026)
- [Govt announces major tax relief for salaried class, businesses, exporters (12 June 2026)](https://www.app.com.pk/?p=1225113), Associated Press of Pakistan (accessed 13 Oct 2026)
- [Budget FY26-27: What relief measures has the government announced for next year? (12 June 2026)](https://www.dawn.com/news/2007344), Dawn (accessed 13 Oct 2026)