Complete Income Tax Chart on Pay Salary for Govt Employees in Budget 2025

The Federal Budget 2025-26 brought a significant wave of relief for government employees in Pakistan. Amid growing inflation and rising living costs, the government has revised the income tax structure to ease the financial burden on salaried individuals, especially federal employees. This strategic shift includes updated tax slabs, salary increases, and special allowances aimed at supporting both active and retired employees. This article provides a complete income tax deduction chart for salaried government employees for the fiscal year 2025-26, along with comparative figures from 2024-25. Whether you are a teacher, clerk, officer, or pensioner, this detailed tax guide will help you understand your net income and savings under the new tax regime.

Overview of Income Tax Relief for Govt Employees in Budget 2025-26

The Budget 2025-26 includes a major revision in income tax slabs for salaried employees. Here’s what you need to know:

• 10% Adhoc Relief Allowance granted on running basic pay
• 30% Disparity Reduction Allowance for eligible federal employees
• Rs. 6000/month Special Conveyance Allowance for disabled employees
• 7% Pension Increase for retired government employees
• Revised monthly and annual tax rates for all salaried groups

Comparative Income Tax Table: 2025 vs 2026

• Monthly Salary PKR 50,000: No tax applicable in 2025 or 2026
• Monthly Salary PKR 100,000: Tax reduced from PKR 2,500/month to PKR 500/month — Relief: PKR 2,000
• Monthly Salary PKR 150,000: Tax reduced from PKR 10,000 to PKR 6,000 — Relief: PKR 4,000
• Monthly Salary PKR 200,000: Tax reduced from PKR 19,167 to PKR 13,500 — Relief: PKR 5,667
• Monthly Salary PKR 225,000: Tax reduced from PKR 25,417 to PKR 19,250 — Relief: PKR 6,167
• Monthly Salary PKR 250,000: Tax reduced from PKR 31,667 to PKR 25,000 — Relief: PKR 6,667
• Monthly Salary PKR 300,000: Tax reduced from PKR 45,833 to PKR 38,833 — Relief: PKR 7,000
• Monthly Salary PKR 350,000: Tax reduced from PKR 61,250 to PKR 54,250 — Relief: PKR 7,000
• Monthly Salary PKR 400,000: Tax reduced from PKR 78,750 to PKR 71,750 — Relief: PKR 7,000
• Monthly Salary PKR 450,000: Tax reduced from PKR 96,250 to PKR 89,250 — Relief: PKR 7,000
• Monthly Salary PKR 500,000: Tax reduced from PKR 113,750 to PKR 106,750 — Relief: PKR 7,000
• Monthly Salary PKR 550,000: Tax reduced from PKR 131,250 to PKR 124,250 — Relief: PKR 7,000
• Monthly Salary PKR 600,000: Tax reduced from PKR 148,750 to PKR 141,750 — Relief: PKR 7,000
• Monthly Salary PKR 800,000: Tax reduced from PKR 218,750 to PKR 211,750 — Relief: PKR 7,000
• Monthly Salary PKR 1,000,000: Tax reduced from PKR 317,625 to PKR 307,738 — Relief: PKR 9,888
• Monthly Salary PKR 1,500,000: Tax reduced from PKR 510,125 to PKR 498,488 — Relief: PKR 11,638
• Monthly Salary PKR 2,000,000: Tax reduced from PKR 702,625 to PKR 689,238 — Relief: PKR 13,388
• Monthly Salary PKR 2,500,000: Tax reduced from PKR 895,125 to PKR 879,438 — Relief: PKR 15,688
• Monthly Salary PKR 2,800,000: Tax reduced from PKR 1,010,625 to PKR 994,438 — Relief: PKR 16,188
• Monthly Salary PKR 3,000,000: Tax reduced from PKR 1,087,625 to PKR 1,070,738 — Relief: PKR 16,888

Key Benefits of the New Income Tax Policy 2025-26

• Higher Net Salary: Monthly relief ranging from PKR 2,000 to 16,888
• More Savings: Reduced annual tax liability boosts take-home pay
• Support for Low-Income Groups: Income up to PKR 600,000 remains tax-free
• Ease for Disabled Employees: Special monthly conveyance allowance
• Inflation Adjustment: Salary raises accommodate rising expenses

FAQs

Is the 10% Adhoc Relief Allowance taxable?

Yes, the 10% Adhoc Relief Allowance is part of the basic pay and subject to taxation under current rules.

Are pensions affected by the new tax changes?

No, pensions are generally tax-exempt. However, pensioners benefit from a 7% increase in their monthly pension as per the 2025-26 budget.

How do I calculate my exact tax?

You can use the updated tax chart or an online tax calculator based on the new 2025-26 slabs to determine your monthly and yearly deductions.

Are provincial employees included in this relief?

This specific tax relief applies to federal government employees. Provincial taxation policies may differ based on local budgets.

 Is the Special Conveyance Allowance taxable?

It may be partially or fully exempt depending on final FBR rules, but it’s generally treated as an allowance and may be tax-free for disabled employees.