1. What is Pakistan's Tax Structure?

Pakistan has a progressive tax system for salaried individuals with different tax slabs for the fiscal year 2023-2024. The tax is calculated by applying a rate to taxable income and then subtracting a fixed amount.

2. How Does the Calculator Work?

The calculator uses the following formula:

Tax Slabs for 2023-2024:

• Up to PKR 600,000: 0%
• PKR 600,001 - 1,200,000: 2.5% of amount exceeding 600,000
• PKR 1,200,001 - 2,400,000: PKR 15,000 + 12.5% of amount exceeding 1,200,000
• PKR 2,400,001 - 3,600,000: PKR 165,000 + 20% of amount exceeding 2,400,000
• PKR 3,600,001 - 6,000,000: PKR 405,000 + 25% of amount exceeding 3,600,000
• PKR 6,000,001 - 12,000,000: PKR 1,005,000 + 32.5% of amount exceeding 6,000,000
• Above PKR 12,000,000: PKR 2,955,000 + 35% of amount exceeding 12,000,000

3. Importance of Tax Calculation

Details: Accurate tax calculation helps in financial planning, ensures compliance with tax laws, and avoids penalties for underpayment.

4. Using the Calculator

Tips: Enter your annual taxable income in PKR. The calculator will automatically apply the correct tax slab and show your annual tax liability.

5. Frequently Asked Questions (FAQ)

Q1: What counts as taxable income?
A: Taxable income includes salary, bonuses, allowances, and other benefits after allowable deductions.

Q2: Are there any tax exemptions?
A: Yes, certain allowances and benefits may be exempt up to specific limits under Pakistani tax law.

Q3: When are taxes due in Pakistan?
A: Taxes are generally deducted at source by employers monthly, with annual returns due by September 30th.

Q4: What if I have multiple income sources?
A: You must combine all taxable income sources when calculating your total tax liability.

Q5: Are there different rates for non-salaried individuals?
A: Yes, business individuals and AOPs have different tax rates and slabs.