Withholding tax (WHT) is deducted at source on specific payment types in Pakistan — the deductor (payer) collects the tax and remits it to FBR on behalf of the recipient. Rates are half for Active Filers vs non-filers. This calculator shows the WHT to deduct for common payment categories.
How to use: Select the payment type from the dropdown, enter the payment amount, and select whether the recipient is an Active Filer (on ATL) or Non-Filer. The calculator applies the applicable WHT rate and shows the deduction amount and net payment.
Calculate the withholding tax to deduct on common payment types. Rates differ for Active Filers (ATL) vs Non-Filers.
Rates are approximate — verify current applicable rates at fbr.gov.pk. WHT is deductible at source and adjustable in the annual tax return for the recipient.
Adjusting Withholding Tax in Your Return
For recipients, WHT deducted at source is not a final tax — it's an advance payment credited against your annual tax liability. When you file your IRIS return, total WHT deducted throughout the year is offset against your calculated tax liability. If total WHT exceeds your liability, the excess is refundable. Keep all withholding certificates (given by the deductor) as documentation for your return.
Frequently Asked Questions
Withholding tax is a collection mechanism — tax collected at the time of specific transactions. Income tax is the annual liability calculated on total income. WHT is an advance payment toward annual income tax — it's not a separate tax, it's the same income tax collected earlier. Filing your annual return reconciles all WHT collected during the year against your total liability.
No — a valid FBR Tax Exemption Certificate authorises you to make payments without WHT deduction. Request the certificate from the payee, keep a copy, and apply the certificate rate (typically 0% or a reduced rate) for that payee. If the certificate is subsequently found invalid, you (as deductor) may be liable — verify certificates are current and issued by FBR before applying them.
Withholding tax rates can change with each annual Finance Act (typically announced in June budget). The filer/non-filer differential is a standing feature of Pakistan's WHT framework — established policy, not subject to frequent change. However, specific transaction types may have rate revisions in any year's Finance Act.