Logo Taxsono
Back to Blog

Income Tax Slabs 2024–2025

Categories:
Learn Income Tax
Featured image for blog post: Income Tax Slabs 2024–2025
By Taxsono

The Government of Pakistan,  through the Finance Act 2024, has announced new income tax slabs for salaried individuals applicable for the fiscal year 2024–2025.

This year’s budget brought an increase in tax rates for middle-income earners while maintaining the same six-tier structure as the previous year. The key change is a 5% tax rate on income between Rs. 600,000 and Rs. 1,200,000, raising the tax burden slightly on the inflation-affected salaried class.

These revised tax brackets are effective from July 1, 2024, and will apply to salaries earned during the tax year 2025.

Updated Income Tax Slabs 2024–2025 for Salaried Individuals

The following table shows the new tax structure for the tax year 2024–2025, as introduced through the Finance Act 2024:

Taxable Income
Rate of Tax
Where taxable income does not exceed Rs. 600,0000%
Where taxable income exceeds Rs. 600,000 but does not exceed Rs. 1,200,0005% of the amount exceeding Rs. 600,000
Where taxable income exceeds Rs. 1,200,000 but does not exceed Rs. 2,200,000Rs. 30,000 + 15% of the amount exceeding Rs. 1,200,000
Where taxable income exceeds Rs. 2,200,000 but does not exceed Rs. 3,200,000Rs. 180,000 + 25% of the amount exceeding Rs. 2,200,000
Where taxable income exceeds Rs. 3,200,000 but does not exceed Rs. 4,100,000Rs. 430,000 + 30% of the amount exceeding Rs. 3,200,000
Where taxable income exceeds Rs. 4,100,000Rs. 700,000 + 35% of the amount exceeding Rs. 4,100,000

Comparison: Previous Tax Year 2023–2024 vs. 2024–2025

To better understand how these changes affect taxpayers, below is a comparison of the previous tax slabs (2023–2024) with the new rates (2024–2025):

Taxable Income
Rate of Tax
Where taxable income does not exceed Rs. 600,0000%
Where taxable income exceeds Rs. 600,000 but does not exceed Rs. 1,200,0002.5% of the amount exceeding Rs. 600,000
Where taxable income exceeds Rs. 1,200,000 but does not exceed Rs. 2,400,000Rs. 15,000 + 12.5% of the amount exceeding Rs. 1,200,000
Where taxable income exceeds Rs. 2,200,000 but does not exceed Rs. 3,600,000Rs. 165,000 + 22.5% of the amount exceeding Rs. 2,400,000
Where taxable income exceeds Rs. 3,200,000 but does not exceed Rs. 6,000,000Rs. 435,000 + 27.5% of the amount exceeding Rs. 3,600,000
Where taxable income exceeds Rs. 6,000,000Rs. 1,095,000 + 35% of the amount exceeding Rs. 6,000,000

Impact on Salaried Individuals

The Finance Bill 2024 shows that the most affected income groups are those earning Rs. 6 million and above annually (approximately Rs. 500,000 per month).
Their annual tax liability increases by Rs. 22,500, reflecting the government’s effort to maintain revenue amid economic challenges.

Salaried individuals earning up to Rs. 12 million per year (Rs. 1 million per month) will also experience a tax increase of around Rs. 22,000, compared to the previous fiscal year.

Importantly, the income tax exemption threshold remains unchanged at Rs. 600,000 per year (Rs. 50,000 per month). This means that those earning below this level remain fully exempt from income tax, but all others will face slightly higher deductions under the new structure.

For example:

  • A person earning Rs. 100,000 per month will now pay Rs. 2,500 per month in income tax, up from Rs. 1,250 last year.

  • Those in the Rs. 200,000–300,000 monthly bracket will see a proportional increase in their annual tax obligations.

Why the Change Matters

These new slabs indicate the government’s attempt to broaden the tax base and increase fiscal stability while giving partial relief to low-income earners.
However, middle-income earners continue to bear a significant portion of the tax load, highlighting ongoing concerns about income inequality and inflationary pressure.

Tax professionals emphasize that salaried individuals should review their monthly deductions and ensure timely filing of income tax returns to maintain active filer status and avoid higher withholding tax rates on banking, property, and vehicle transactions.

Conclusion

The income tax slabs for 2024–2025 reflect both continuity and adjustment — keeping the same number of brackets while slightly raising tax rates for certain income groups.

For the salaried class, these changes mean higher monthly deductions but also underscore the importance of staying compliant with FBR regulations and filing returns on time to retain active filer benefits.

Related Blogs