Business Tax Calculator
Calculate FBR income tax for sole proprietors, non-salaried individuals & AOPs — 2026-2027 rates.
Non-Salaried / Business Tax Slabs 2026-2027
Applies to sole proprietors, business owners, and AOPs. Generally higher rates than salaried slabs.
| Annual Net Business Income | Fixed Tax | Rate on Excess |
|---|---|---|
| Up to Rs. 600,000 | Rs. 0 | 0% |
| Rs. 600,001 – Rs. 1,200,000 | Rs. 0 | 15% of excess over 600k |
| Rs. 1,200,001 – Rs. 1,600,000 | Rs. 90,000 | 20% of excess over 1.2M |
| Rs. 1,600,001 – Rs. 3,200,000 | Rs. 170,000 | 30% of excess over 1.6M |
| Rs. 3,200,001 – Rs. 5,600,000 | Rs. 650,000 | 40% of excess over 3.2M |
| Above Rs. 5,600,000 | Rs. 1,610,000 | 45% of excess over 5.6M |
Frequently Asked Questions
Who is considered a non-salaried individual by the FBR?
A non-salaried individual is someone whose taxable salary constitutes less than 75% of their total taxable income. This category primarily includes sole proprietors, freelancers, and business owners.
What expenses can I deduct from my gross business income?
You can deduct wholly and exclusively incurred business expenses, such as rent, utility bills, employee salaries, depreciation of assets, and marketing costs. Personal expenses are strictly not deductible.
Do Association of Persons (AOPs) use the same tax slabs?
Yes, standard AOPs are taxed according to the non-salaried/business tax slabs, applying the progressive rates to the AOP's total net profit.
What is the minimum business income exempt from tax?
Business income up to Rs. 600,000 per year is exempt from FBR income tax for non-salaried individuals and sole proprietors. Above this, the progressive slab rates apply.
Do I need to file a tax return if my business income is below Rs. 600,000?
You are legally required to file a return if your annual income is above Rs. 600,000. However, even if below this threshold, filing is recommended to maintain ATL status and benefit from lower withholding tax rates on banking and property transactions.
How does business tax differ from salary tax in Pakistan?
Business income uses higher, steeper non-salaried tax slabs — the second bracket starts at 15% vs. only 1% for salaried workers. Business owners also cannot benefit from medical allowance exemptions. However, they can deduct legitimate business expenses, which salaried employees cannot.