Understanding Super Tax Under Section 4C (Pakistan)
Super Tax is an additional income tax introduced under Section 4C of the Income Tax Ordinance, 2001, to raise extra revenue from the highest earners. It applies to individuals, Associations of Persons (AOPs), and companies whose income for the year exceeds Rs. 150 million. It is charged on top of your normal income tax — not instead of it. The rate that applies to you depends on which income tier you fall into, ranging from 1% up to 10%.
Who Has to Pay It?
Only persons with income above Rs. 150 million in the tax year. If your income is below that threshold, Section 4C super tax does not apply to you at all. The top rate of 10% applies to all sectors with income above Rs. 500 million (the earlier sector-based discrimination was removed by the Finance Act, 2023). The Finance Act, 2025 reduced the rates by 0.5% for income between Rs. 250 million and Rs. 500 million, effective tax year 2026.
How It Is Calculated
The super tax rate for your income tier is applied to your income for the year. For example, a person with income of Rs. 220 million falls in the 200M–250M tier (2%), so super tax ≈ Rs. 4.4 million, payable in addition to normal income tax. Marginal relief provisions in the law soften the jump where income only just crosses a tier boundary.
Frequently Asked Questions
Is super tax separate from the high-income surcharge?
Yes. The surcharge for high-earning salaried individuals is a different levy under a different provision. Super tax under Section 4C only starts at Rs. 150 million and is calculated separately.
Does it apply to salaried individuals?
Only if total income exceeds Rs. 150 million — which is rare for salaried earners. It most commonly affects large companies and high-income businesses.
Are these rates final?
Super tax rates are set by each year's Finance Act and can change. Always confirm the current rate on the FBR portal or with a tax professional before filing.