Every tax year, salaried employees and their employers need to apply the correct FBR income tax slabs. Here are the salaried tax slabs used for 2026-27, with worked examples so you can sanity-check any payroll run.
The salaried tax slabs (2026-27)
| Annual taxable income (Rs) | Tax |
|---|---|
| 0 – 600,000 | 0% |
| 600,000 – 1,200,000 | 1% of the amount over 600,000 |
| 1,200,000 – 2,200,000 | 6,000 + 11% of the amount over 1,200,000 |
| 2,200,000 – 3,200,000 | 116,000 + 23% of the amount over 2,200,000 |
| 3,200,000 – 4,100,000 | 346,000 + 30% of the amount over 3,200,000 |
| Above 4,100,000 | 616,000 + 35% of the amount over 4,100,000 |
A surcharge applies on the calculated tax when annual taxable income exceeds Rs 10,000,000.
Worked example
Say an employee earns Rs 300,000 per month, or Rs 3,600,000 a year. That falls in the 3,200,000 – 4,100,000 band:
- Fixed tax: 346,000
- Plus 30% of (3,600,000 − 3,200,000) = 30% of 400,000 = 120,000
- Annual tax = 466,000, roughly 38,833 per month.
Don’t calculate this by hand every month
Slabs change with each budget, and applying them manually across a team invites errors. Payroll software applies the right slab automatically on every run. You can test any salary instantly with the free PayTime salary tax calculator, which supports multiple tax years — or let PayTime apply it across your whole payroll.
Always confirm the current rates against the latest FBR Finance Act; this article is a general explainer, not tax advice.
