Latest Budget 2025-26 Pakistan – Income Tax Changes Explained
The Federal Budget 2025-26 introduced updates to income tax slabs for salaried individuals in Pakistan. In this guide, we explain the key tax changes, revised salary tax rates, and how these updates affect taxpayers.
Overview of Budget 2025-26 Tax Changes
The government revised income tax slabs to adjust tax burden on salaried individuals. Some slabs have lower entry rates, while higher income groups face progressive tax adjustments.
Updated Salaried Income Tax Slabs 2025-26
| Annual Income | Tax Rate |
|---|---|
| Up to Rs 600,000 | 0% |
| 600,001 – 1,200,000 | 1% |
| 1,200,001 – 2,400,000 | 15% |
| 2,400,001 – 3,600,000 | 25% |
| Above 3,600,000 | 35% |
Example Salary Tax Calculation
Suppose your monthly salary is Rs 100,000. Your annual income will be Rs 1,200,000. The first Rs 600,000 is tax-free. The remaining Rs 600,000 is taxed at 1%, resulting in Rs 6,000 yearly tax.
Who Is Affected by These Changes?
These tax changes primarily affect salaried employees in the private and government sectors. Higher income earners will see larger adjustments due to progressive tax slabs.
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Open Income Tax CalculatorFrequently Asked Questions
When does Budget 2025-26 apply?
The updated tax slabs apply from the start of the new fiscal year.
Are non-salaried slabs different?
Yes, non-salaried individuals follow a separate tax structure.