Withholding Tax Calculator Pakistan 2026-27
Calculate WHT for services, goods, and contracts under latest FBR Finance Act.
Ordinance Context
Applies under Section 153(1)(b) of the Income Tax Ordinance 2001.
Payment Breakdown
Filer Benefit
Filers pay lower withholding tax, improving cash flow for vendors and contractors.
Non-Filer Penalty
Non-filers are often subjected to double tax rates as a deterrent by FBR.
What is Withholding Tax in Pakistan?
Withholding tax (WHT) is an advance income tax collected at the point of payment — before the money reaches the recipient. Under Pakistan's Income Tax Ordinance 2001, the person making a payment (buyer, employer, or payer) is responsible for deducting WHT and depositing it with the FBR on behalf of the recipient. This system allows FBR to collect tax throughout the year rather than waiting for annual returns, and covers a wide range of transactions including goods supply, services, contracts, rent, dividends, bank profits, and freelancer remittances.
Key WHT Sections Under FBR Ordinance 2026-27
Different types of payments are governed by different sections of the Income Tax Ordinance. Section 153(1)(a) covers supply of goods, Section 153(1)(b) covers rendering of services, and Section 153(1)(c) covers execution of contracts — each with its own filer and non-filer rates. Section 155 applies to rent payments, Section 151 to profit on bank deposits, Section 150 to dividends, and Section 154A to freelancer and IT export remittances. The calculator above covers all these categories so you can select the correct section for your transaction type.
Filer vs Non-Filer WHT Rates
Being on the FBR's Active Taxpayer List (ATL) significantly lowers the withholding tax rate applied to your payments. Non-filers are typically charged double or more compared to filers — for example, on services under Section 153, filers pay 8% while non-filers pay a higher rate. This difference directly affects the cash flow of vendors, contractors, landlords, and anyone receiving regular business payments. Becoming an active filer through FBR IRIS is free and immediately reduces WHT deductions on future payments.
Is Withholding Tax Refundable in Pakistan?
Yes. Withholding tax deducted at source is generally adjustable against your final annual income tax liability. When you file your annual income tax return with FBR, the total WHT already deducted throughout the year is credited against your total tax due. If the total WHT deducted exceeds your actual tax liability for the year, you are entitled to a refund, which can be claimed through the FBR IRIS portal by submitting your return and applying for the refund electronically.