Progressive super tax on company and high-income-person income.
Super tax
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Top band rate
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Effective rate
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A separate tax on top of the ordinary one
Super tax is not your normal income tax. It is an extra charge introduced under Section 4C of the Income Tax Ordinance and aimed squarely at the largest earners: companies and high-income persons. It sits on top of whatever corporate or personal tax already applies, which is why a big business can end up paying its standard rate plus this surcharge in the same year. The Federal Board of Revenue (FBR) administers it, and the structure has been progressive since it was widened: small slices of income are taxed at low add-on rates, and the rate steps up as income climbs.
This calculator is for finance teams, founders, and tax-aware individuals who want a quick read on the Section 4C bill for a given level of income. You enter one number, the income that super tax is charged on, and it returns the tax, the top band rate that applies to you, and the effective rate across your whole income. It deliberately does not compute corporate or slab tax, because super tax is a standalone layer you add afterwards.
Why the first PKR 150 million escapes, and the cap at the top
Two design features matter. First, there is a floor: income below the entry threshold pays nothing. The threshold this calculator uses is PKR 150 million, so a person or company under that line owes zero super tax. Second, there is a ceiling. No matter how large the income, the top band rate is capped at 10 percent, applied to income above the highest threshold the tool models, PKR 500 million. Between those two points the rate rises in steps. These thresholds and the rate on each band are the figures this calculator applies and are exactly the sort of numbers Pakistan revises through the annual Finance Act, so treat them as the modelled position and confirm the current bands with the FBR before filing.
The tool computes the charge band by band rather than slapping a single rate on the whole figure. That marginal reading is the conservative one: each slice of income is taxed only at the rate for the band it falls in. The "top band rate" shown is the highest band your income reaches, while the "effective rate" is the total super tax divided by your full income, which is always lower than the top band rate because the early slices are taxed lightly or not at all.
Working a PKR 300 million income through the bands
Load the default, PKR 300 million of income for super tax. The first PKR 150 million sits in the zero band. The slice from PKR 150 million to PKR 200 million is taxed at the 1 percent the calculator applies, the next slice to PKR 250 million at 2 percent, and the final slice to PKR 300 million at 3 percent. Note the boundary: at exactly PKR 300 million your income reaches the top of the 3 percent band but does not cross into the 4 percent band, so the top band rate shown is 3 percent.
| Income slice | Rate applied | Super tax on slice |
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The total super tax is PKR 3 million, which the result box prints as "Rs 3,000,000". Divide that by the PKR 300 million income and the effective rate is exactly 1.00 percent, far below the 3 percent top band, because two thirds of the income was taxed at zero or 1 percent. The bars below show how little each slice contributes.
The chart below shows the income breakdown: super tax versus income retained.
A common mistake and a planning note
The frequent error is confusing the top band rate with the rate on your whole income. Someone at PKR 300 million who hears "I am in the 3 percent band" often assumes a PKR 9 million bill, when the marginal computation gives PKR 3 million. Read the effective rate, not the band rate, when you are budgeting cash. The other trap is forgetting that super tax stacks on corporate or slab tax, so the all-in burden on a large company is the standard rate plus this charge, and there is no netting between them. Because the brackets here are unverified and move with each budget, anyone close to a threshold should model the exact bands the FBR publishes for the current year before committing to a number.
Do individuals pay super tax, or only companies?
Both can. Section 4C reaches high-income persons as well as companies. An individual or association of persons whose income for super tax purposes crosses the entry threshold the calculator uses, PKR 150 million, faces the same band structure a company does. It is genuinely a tax on scale of income, not on legal form.
Is the effective rate ever close to 10 percent?
Only at very large incomes. Because the early hundreds of millions are taxed lightly, the effective rate creeps up slowly. You need income well above PKR 500 million before the average approaches the 10 percent cap, since by then most of the income is sitting in the top band. At PKR 300 million the average is just 1.00 percent, as the worked example shows.