11/10/2015
ASHRAF & ASHRAF LAW FIRM
TAX PRACTITIONERS IN PAKISTAN
Cell: 0321 4581017
Web: www.ashraflawfirm.com
The Federal Board of Revenue (FBR) has reduced tax rates for individuals and Association of Persons (AoPs) earning (between Rs400,000 to Rs500,000) through Finance Act, 2015. This reduction is notified through tax circular No 2 of 2015.
To provide relief to non-salaried individuals and AoPs, particularly those earning income fall above said category, the tax rates have been reduced from 10 percent to 7 percent through Finance Act, 2015 and for salaried individual earning between 400,000 to 500,000 tax rates have been reduced 5 percent to 2 percent. This relief will be available to all salaried and non-salaried individuals and AoPs who are earning more than Rs500,000. The revised tax slabs for non salaried individuals and AoPs are as under:
Tax rates for non-salaried individuals and AoPs: Where the taxable income does not exceed Rs 400,000, rate of tax would be 0 percent; where the taxable income exceeds Rs 400,000 but does not exceed Rs 500,000, tax rate would be 7 percent of the amount exceeding Rs 400,000; Where the taxable income exceeds Rs500,000 but does not exceed Rs 750,000. tax rate would be Rs 7,000 + 10 percent of the amount exceeding Rs 500,000; Where the taxable income exceeds Rs 750,000 but does not exceed Rs 1,500,000, tax rate would be Rs 32,000 + 15 percent of the amount exceeding Rs750,000; where the taxable income exceeds Rs 1,500,000 but does not exceed Rs2,500,000, tax rate would be Rs 144,500 + 20 percent of the amount exceeding Rs1,500,000; where the taxable income exceeds Rs 2,500,000 but does not exceed Rs4,000,000, tax rate would be Rs 344,500 + 25 percent of the amount exceeding Rs2,500,000; where the taxable income exceeds Rs 4,000,000 but does not exceed Rs6,000,000, tax rate would be Rs 719,500 + 30 percent of the amount exceeding Rs 4,000,000 and where the taxable income exceeds Rs 6,000,000, tax rate would be Rs 1,319,500 + 35 percent of the amount exceeding Rs 6,000,000.
Tax rates for salaried individuals: Where the taxable income does not exceed Rs 400,000, tax rate would be 0 percent; where the taxable income exceeds Rs 400,000 but does not exceed Rs 500,000, tax rate would be 2 percent of the amount exceeding Rs 400,000; Where the taxable income exceeds Rs 500,000 but does not exceed Rs 750,000, tax rate would be Rs 2,000 + 5 percent of the amount exceeding Rs 500,000; where the taxable income exceeds Rs 750,000 but does not exceed Rs 1,400,000, tax rate would be Rs 14,500 + 10 percent of the amount exceeding Rs750,000; where the taxable income exceeds Rs 1,400,000 but does not exceed Rs1,500,000, tax rate would be Rs 79,500 + 12.5 percent of the amount exceeding Rs1,400,000; where the taxable income exceeds Rs 1,500,000 but does not exceed Rs1,800,000, tax rate would be Rs 92,000 + 15 percent of the amount exceeding Rs1,500,000; where the taxable income exceeds Rs 1,800,000 but does not exceed Rs 2,500,000, tax rate would be Rs 137,000 + 17.5 percent of the amount exceeding Rs 1,800,000; where the taxable income exceeds Rs 2,500,000 but does not exceed Rs 3,000,000, tax rate would be Rs 259,500 + 20 percent of the amount exceeding Rs 2,500,000; where the taxable income exceeds Rs 3,000,000 but does not exceed Rs 3,500,000, tax rate would be Rs 359,500 + 22.5 percent of the amount exceeding Rs 3,000,000; where the taxable income exceeds Rs3,500,000 but does not exceed Rs 4,000,000, tax rate would be Rs 472,000 + 25 percent of the amount exceeding Rs 3,500,000; where the taxable income exceeds Rs 4,000,000 but does not exceed Rs 7,000,000, tax rate would be Rs 597,000 + 27.5 percent of the amount exceeding Rs 4,000,000; where the taxable income exceeds Rs 7,000,000, tax rate would be Rs 1,422,000 + 30 percent of the amount exceeding Rs 7,000,000.
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