Monthly salary tax withheld under section 149.
Monthly withholding
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Annual tax
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Annualised salary
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Why tax leaves your pay before you ever see it
In Pakistan a salaried person rarely writes a cheque to the tax authority at year end. Instead the employer is legally required to deduct tax at source from each month's pay and deposit it with the Federal Board of Revenue (FBR). This is salary withholding, operated under section 149 of the income tax law. Your monthly payslip already shows the deduction, and your annual return mostly reconciles what was withheld against what was actually due. This calculator reproduces the employer's monthly arithmetic so you can check the figure on your payslip or work out what a take-home offer really means before tax.
The annualise, tax, then divide method
The mechanic is straightforward once you see it. The employer does not tax each month in isolation. It projects your annual salary by scaling the monthly figure up, computes the full-year income tax on that projection using the salaried slabs, and then deducts one-twelfth of that annual tax each month. The tool mirrors this exactly: it multiplies your monthly salary by twelve, runs the result through the salaried schedule it uses for the 2025-26 tax year, and divides the annual tax by twelve to give the monthly deduction. Where annual income crosses the high-income surcharge line the engine adds the surcharge too, though most salaried payslips sit well below it. Because the slab boundaries are set by the annual Finance Act, confirm the current ones with the FBR rather than assuming last year's figures still hold.
A PKR 200,000 monthly salary, step by step
Take the default. A monthly gross of PKR 200,000 annualises to PKR 2.4 million. Running that through the salaried slabs the calculator applies, the first PKR 600,000 is free, the next PKR 600,000 is taxed at 1 percent for PKR 6,000, the next PKR 1 million at 11 percent for PKR 110,000, and the final PKR 200,000 at 23 percent for PKR 46,000. That totals PKR 162,000 of annual tax. Divide by twelve and the employer withholds PKR 13,500 from each month's pay.
| Step the employer takes | Working | Amount |
|---|
The chart shows the annual tax bill being sliced into twelve equal monthly deductions.
What happens when your pay changes mid-year
The one-twelfth rule only holds if your salary is steady. Get a raise in month seven and the employer is meant to re-estimate your annual income from that point and spread the remaining tax over the months left, so your deduction rises. A mid-year bonus is handled the same way, by folding it into the annual projection and recalculating. This is also why the monthly figure on a payslip can jump even though your basic pay did not, and why two people on the same current salary can have different deductions if one joined partway through the year. A common mistake is reading the monthly withholding as your final tax. It is an estimate. Allowable tax credits, such as an approved pension contribution, are usually settled in the annual return, which can produce a small refund or a top-up.
Who this is for
It is built for salaried employees checking a payslip and for jobseekers translating a gross offer into monthly cash. If you have significant non-salary income, the annual return is where everything is reconciled, and the withholding alone will understate your true liability.
My employer withheld more than this tool shows. Why?
Common reasons are that the employer is projecting a higher annual figure because of bonuses or allowances you did not enter here, or that a raise triggered a mid-year recalculation that loaded extra tax onto the remaining months. Compare your full annualised package, including taxable allowances, against the tool's annual figure rather than just basic pay.
Can I reduce the monthly deduction during the year?
Sometimes. If you are entitled to a tax credit, for example on an approved pension contribution, you can ask your employer to account for it when computing the withholding rather than waiting for the annual refund. The employer applies it under the section 149 estimate. Check what your payroll team accepts and confirm eligibility for the current year with the FBR.