Income Tax Calculator Pakistan 2026-27 (Business & Non-Salaried)
For business owners, shopkeepers, professionals, landlords' other income and AOPs (partnerships): enter your taxable income to see the tax for 2026-27.
| Annual taxable income | Tax |
|---|---|
| Up to Rs 600,000 | 0% |
| Rs 600,001 – Rs 1,200,000 | 15% of amount above Rs 600,000 |
| Rs 1,200,001 – Rs 1,600,000 | Rs 90,000 + 20% of amount above Rs 1,200,000 |
| Rs 1,600,001 – Rs 3,200,000 | Rs 170,000 + 30% of amount above Rs 1,600,000 |
| Rs 3,200,001 – Rs 5,600,000 | Rs 650,000 + 40% of amount above Rs 3,200,000 |
| Above Rs 5,600,000 | Rs 1,610,000 + 45% of amount above Rs 5,600,000 |
Plus a 10% surcharge on the tax if taxable income exceeds Rs 10,000,000.
Income tax rates for non-salaried individuals in 2026-27
If less than 75% of your taxable income comes from salary, you are taxed as a non-salaried individual. The same slabs apply to an association of persons (AOP), such as a partnership firm. The first Rs 600,000 is tax-free; after that the rate rises from 15% to 45%. The Finance Act 2026 cut taxes for salaried people but left these slabs unchanged, and the 10% surcharge under section 4AB still applies to taxable income above Rs 10 million.
Examples for 2026-27
| Annual taxable income | Tax (business) | Effective rate | Tax if it were salary |
|---|---|---|---|
| Rs 1,000,000 | Rs 60,000 | 6.0% | Rs 4,000 |
| Rs 2,400,000 | Rs 410,000 | 17.1% | Rs 156,000 |
| Rs 4,000,000 | Rs 970,000 | 24.3% | Rs 516,000 |
| Rs 8,000,000 | Rs 2,690,000 | 33.6% | Rs 1,774,000 |
The comparison shows why the salaried and non-salaried regimes are so different: at Rs 4 million a year, business income pays almost twice the tax of the same amount of salary.
How it is calculated
Find your slab and apply its formula: a fixed amount plus a percentage of the income above the slab's lower limit. For Rs 2.4 million: Rs 170,000 + 30% × (2,400,000 − 1,600,000) = Rs 410,000. If taxable income is above Rs 10 million, add 10% of that tax as surcharge.
Sources and limits
Rates are those of the Income Tax Ordinance 2001 (First Schedule, Part I) as continued by the Finance Act 2026; see PwC Pakistan's Tax Memorandum and FBR. The result is an estimate of tax on taxable income: it does not include advance or withholding tax already paid (which you adjust in your return), final-tax income, minimum tax regimes, tax credits or special rates for professional firms. A tax adviser can confirm your exact liability. Salaried? Use the salary tax calculator.
Frequently asked questions
- Who counts as non-salaried in Pakistan?
- Anyone whose salary is 75% or less of their taxable income: business owners, freelancers, consultants, shopkeepers and people with mainly rental or other income. Partnerships and other AOPs use the same slabs.
- Did the 2026-27 budget change business tax slabs?
- No. The Finance Act 2026 reduced rates for salaried individuals only. Non-salaried slabs (15%, 20%, 30%, 40%, 45%) and the 10% surcharge above Rs 10 million stayed the same.
- What is the tax-free income limit for business people?
- Rs 600,000 a year, the same as for salaried individuals. Above that the first slab is 15%, compared with 1% for salary.
- Does this include withholding tax deducted on my sales or bank transactions?
- No. Withholding (advance) tax is adjusted against the liability calculated here when you file your return. Subtract it to estimate what you still have to pay.
- Is freelance income from abroad taxed at these rates?
- Export of IT and IT-enabled services can fall under special reduced or final-tax regimes when proceeds come through banking channels and conditions are met. Check with FBR or a tax adviser before using these slabs for such income.
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