Income Tax Rates

Rates for individuals, AOPs and companies, with the key final and separate rates.

Tax Year 2027 (1 July 2026 to 30 June 2027)

Salaried individuals

These rates apply when salary is more than 75% of a person's taxable income for the year. Rates are on taxable income in rupees.

Pension from a former employer is not taxed up to Rs 10 million. Above that, 5% of the amount above Rs 10 million applies, and the tax is final. Individuals aged 70 or more pay no tax on pension.
No surcharge applies to salaried individuals, including on pension.
Director's fee for attending board meetings is taxed at 20% (section 149(3)).
Use the Salary Tax Calculator to estimate your tax.

These rates apply to business income, professional income and other income of individuals and associations of persons (AOPs).

An AOP that is a professional firm barred from incorporating, by law or by the rules of its professional body, pays 40% instead of 45% in the top slab.
A surcharge of 10% of the tax is added when taxable income is above Rs 10 million (section 4AB).
Builders and developers are taxed under section 7F.

Companies pay tax at a flat rate on taxable income.

Company tax rates
Type of company	Tax Year 2025	Tax Year 2026	Tax Year 2027 onwards
Banking company	44%	43%	42%
Small company	20%	20%	20%
Any other company	29%	29%	29%

Minimum tax on turnover (section 113)
Rate of turnover	Cases
0.25%	Petroleum agents and distributors, rice mills and dealers, Tier 1 retailers integrated with FBR, e-commerce turnover including online marketplaces, used vehicle traders, flour mills
0.5%	Oil refineries, motorcycle dealers registered for sales tax, oil marketing companies
0.75%	Sui gas companies with turnover above Rs 1 billion, PIA, poultry industry
1.25%	All other cases

The SME regime (section 100E) is for a person engaged in manufacturing with turnover up to Rs 250 million. With turnover up to Rs 100 million the tax is 7.5% of taxable income, or 0.25% of turnover under the final regime. With turnover above Rs 100 million up to Rs 250 million the rates are 15% and 0.5%.

Super tax applies to high earning persons. The rate is applied to the whole income, not only to the amount above the limit.

Super tax, Tax Year 2027
Person	Income above	Rate
Banking company	Rs 150 million	10% of income
Petroleum exploration and production (Fifth Schedule, Part I)	Rs 150 million	10% of income
Person earning income from sale of fertilizer	Rs 150 million	10% of income
Any other person	Rs 500 million	8% of income

Super tax applies to individuals and AOPs as well as companies.
Super tax does not apply where export proceeds realised are more than 80% of total turnover for the year.
The gain on one personal residence held for 15 years is not subject to super tax.

A surcharge of 10% of the income tax is payable by an individual or AOP whose taxable income is above Rs 10 million.

These rates apply to specific kinds of income. Rates are for filers. Non-filers pay double on dividends and profit on debt.

Dividend
Case	Rate
Independent power producers, pass-through dividend reimbursable by CPPA-G	7.5%
REITs and all other cases	15%
Mutual funds: debt income component	25% (29% for a corporate recipient)
Mutual funds: equity income component	15%
Special purpose vehicle dividend received by a REIT scheme	0%
Special purpose vehicle dividend received by others	35%
Company paying no tax because of exemption, losses or credits	25%

Profit on debt (individuals and AOPs)
Case	Rate
Bank or financial institution account or deposit	20%
Government securities paid to a person other than an individual	20%
Other cases, including National Savings schemes and Government securities held by individuals	15%

Return on sukuk
Holder	Rate
Company	25%
Individual or AOP, return above Rs 1 million	12.5%
Individual or AOP, return below Rs 1 million	10%

Capital gains on securities (acquired on or after 1 July 2024)
Case	Rate
Filer on the dates of both purchase and sale	15%
Non-filer individual or AOP	Normal slab rate, but not less than 15%
Non-filer company	29% (20% for a small company, 42% for a banking company)
PMEX future commodity contracts	5%

Capital gains on immovable property acquired on or before 30 June 2024, by holding period
Holding period	Open plots	Constructed property	Flats
Up to 1 year	15%	15%	15%
Over 1 year up to 2 years	12.5%	10%	7.5%
Over 2 years up to 3 years	10%	7.5%	0%
Over 3 years up to 4 years	7.5%	5%	Not applicable
Over 4 years up to 5 years	5%	0%	Not applicable
Over 5 years up to 6 years	2.5%	Not applicable	Not applicable
Over 6 years	0%	Not applicable	Not applicable

Capital gains on immovable property acquired on or after 1 July 2024
Case	Rate
Filer, any holding period	15%
Non-filer individual or AOP	Normal slab rate, but not less than 15% of the gain
Non-filer company	29% (20% for a small company, 42% for a banking company)

Other rates
Income	Rate
Gain on certain debt securities held through a custodian (section 151A)	20% of the gross gain
Royalty, fees for technical services and fees for offshore digital services paid to non-residents (section 6)	15% of the gross amount (10% in other cases)
E-commerce (section 6A), payment made digitally	1%
E-commerce (section 6A), cash on delivery	2%
Non-resident shipping (section 7)	8% of gross receipts
Non-resident air transport (section 7)	3% of gross receipts

Securities acquired from 1 July 2013 to 30 June 2022 are taxed at 12.5%. Securities acquired before 1 July 2013 are taxed at 0%.
Dividend tax is generally final. Profit on debt is final for individuals and AOPs up to Rs 5 million, and above that the profit is taxed at normal rates.

For general information only. Not professional advice. Please contact us for your specific situation.