How to use the rental income tax calculator
- 1 Enter the monthly rent you receive.
- 2 Enter your other taxable income for the year, such as salary or business profit.
- 3 Choose whether that other income is mainly salary or business.
- 4 Read the yearly tax on your rent and compare it with the tenant's withholding.
Worked example
A landlord with no other income who receives Rs 100,000 rent a month. Yearly rent is Rs 1,200,000. Under non-salaried slabs the tax is 15% of the Rs 600,000 above the exempt limit, which is Rs 90,000 a year, about Rs 7,500 a month. A company tenant would withhold Rs 75,000 under section 155, so about Rs 15,000 more is paid with the return.
Declaring rent correctly
- Who withholds: companies, government bodies and some other institutions must deduct tax from rent under section 155; individual tenants usually do not.
- Joint ownership: each owner declares their share of the rent and is taxed on it separately.
- Keep the agreement: a written, ideally registered, rent agreement supports the figures in your return.
- Withholding is adjustable: tax deducted by the tenant is credited against your final tax when you file.
Rent agreements often rise 10% a year; see how your income grows with the Rent Increase Calculator. Selling the property later? Check the Property Tax Calculator.
Features
Normal slab method
Rent is added to your income and taxed at tax year 2027 slab rates, as the law now requires.
Salaried or business slabs
Salaried slabs apply only when salary is more than 75% of total income.
Section 155 withholding
Shows the advance tax a company or institution tenant must deduct from your rent.
Balance due
Shows what is still payable or refundable when you file your return.
When to use it
Landlords
Know how much to keep aside from rent for tax. See how rent grows with the Rent Increase Calculator.
Retired people
See tax on rent when it is your only income. Selling later? Check the Property Tax Calculator.
Salaried owners
See how renting out a second home changes your tax. Compare with the Business Income Tax Calculator.
Before signing a lease
Estimate tax on a new rent amount. Not a filer? See the Filer vs Non-Filer Tax Calculator.
Related Tax tasks
Frequently asked questions
How is rental income taxed in Pakistan now?
Rent is treated as income from property. It is added to your other taxable income and taxed at the slab rates for your category. The separate rental tax table was removed by Finance Act 2021.
What is the tax-free limit?
The first Rs 600,000 of total taxable income is taxed at zero, whether it comes from salary, rent or business.
What are the non-salaried slabs for tax year 2027?
Nil up to Rs 600,000; 15% from Rs 600,001 to 1,200,000; Rs 90,000 plus 20% up to 1,600,000; Rs 170,000 plus 30% up to 3,200,000; Rs 650,000 plus 40% up to 5,600,000; and Rs 1,610,000 plus 45% above.
When does a tenant deduct tax?
Companies, banks, government bodies and other prescribed persons who pay rent must withhold tax under section 155: nil up to Rs 300,000 a year, 5% up to Rs 600,000, Rs 15,000 plus 10% up to Rs 2 million and Rs 155,000 plus 25% above.
Is the tenant's deduction my final tax?
No. It is adjustable against your yearly tax. If your actual tax is higher you pay the difference with your return; if lower, you can claim a refund.
Can I deduct expenses from rent?
Yes, in many cases: a repair allowance, insurance, ground rent, property tax and some other costs. Keep receipts and check the current rules.
Do I need to file a return?
Yes, if your total income is above the taxable limit or you own property above prescribed values. Filing also keeps you on the Active Taxpayer List.
What if the property is jointly owned?
Each owner declares their share of rent and pays tax on it according to their own income.
Does rent count for the 10% surcharge?
Yes. If total taxable income of a non-salaried individual is above Rs 10 million, a 10% surcharge applies to the tax.
Results are estimates based on the official rates linked above. Confirm important figures with the issuing authority or a qualified adviser before you act on them.
Built and reviewed by Hamza Farooq, founder and lead developer
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