If you freelance from Pakistan and get paid from abroad, the first tax question is usually: which rate applies to me? This guide explains the common cases for FY 2026-27 and shows a worked example. It is general information, not tax advice, so confirm the current rules with the FBR or a consultant before you file.
Step 1: Work out what kind of income you have
The rate depends on what you sell and how you are registered. The commonly used rates in our calculator are:
| Type of income | Rate |
|---|---|
| IT export services, registered with PSEB | 0.25% |
| Other export services | 1% |
| Export of goods | 1.25% |
| Domestic IT services (filer) | 4% |
| Domestic IT services (non-filer) | 8% |
The big difference is PSEB registration. If you export IT services and are registered, the rate is far lower than for other export services.
Step 2: Apply the rate to what you receive
The rates above apply to the amount received in your bank account, not your profit. For example, if you receive Rs 1,000,000 for IT export services as a PSEB-registered freelancer:
- 0.25% of Rs 1,000,000 = Rs 2,500
If the same income were taxed as "other export services" at 1%, it would be Rs 10,000. That is why registration matters.
Step 3: Keep your records
Keep invoices, client contracts and the bank statements that show each payment. Money that arrives through proper banking channels is easier to explain if the FBR ever asks.
Step 4: File a return, even if you owe little
Filing keeps you on the Active Taxpayers List. Being listed matters because non-filers pay higher withholding on bank cash withdrawals, vehicles and property. If you file late, there may be a penalty and a surcharge to be added back to the list, so file on time.
Try it yourself
I built a free calculator that applies these rates: Freelancer tax calculator for Pakistan. If you want to see how late filing is treated, see Late tax return penalty in Pakistan.
Disclaimer: Rates and rules change, and your situation may differ. This article is an estimate guide only.
