{
  "$comment": "Machine-readable companion to https://valem.run/calculators/pakistan/self-employed. Formula, inputs, outputs, engine-verified test vectors, cited sources and the re-runnable Valem ModelSpec behind the page.",
  "url": "https://valem.run/calculators/pakistan/self-employed",
  "dataUrl": "https://valem.run/calculators/pakistan/self-employed.json",
  "license": {
    "name": "CC BY 4.0",
    "url": "https://creativecommons.org/licenses/by/4.0/",
    "attribution": "Pakistan business income tax model by Valem (https://valem.run/calculators/pakistan/self-employed), CC BY 4.0.",
    "note": "Covers the model — the expression of each rule and the arrangement of the catalog. The rates and thresholds themselves are law and are not licensed by anyone; the cited sources are where they come from."
  },
  "verificationUrl": "https://valem.run/calculators/pakistan/self-employed/verify",
  "country": "pakistan",
  "countryName": "Pakistan",
  "formula": "self-employed",
  "formulaName": "Business income tax",
  "localName": null,
  "localLang": null,
  "englishName": "Business income tax",
  "title": "Business income tax Pakistan 2026-27 — self-employed calculator",
  "answer": "A self-employed individual in Pakistan pays income tax on business or professional profit at the non-salaried rates — nothing on the first Rs600,000, then 15% rising to 45% above Rs5.6 million — and a surcharge of 10% of that tax when taxable income exceeds Rs10 million.",
  "lang": "en",
  "currency": "PKR",
  "taxYear": "2026-27",
  "verification": {
    "claim": "internal-consistency",
    "statement": "The Valem engine reproduces this model's stated formula through 6 self-test cases (below, and re-runnable against the spec). That asserts internal consistency, NOT that the formula matches current law — the cited sources are the evidence for that, and carry the date each was last checked.",
    "selfTestCases": 6,
    "ratesAreIllustrative": false,
    "sourcesCheckedOn": "2026-11-01"
  },
  "sources": [
    {
      "label": "Income Tax Ordinance 2001 (FBR, amended to 30 June 2026), First Schedule Pt I Div I(1)",
      "url": "https://download1.fbr.gov.pk/Docs/2026724177725705IncomeTaxOrdinanace2001.pdf",
      "checked": "2026-11-01"
    },
    {
      "label": "Income Tax Ordinance 2001 s.4AB: 10% surcharge above Rs10 million",
      "url": "https://download1.fbr.gov.pk/Docs/2026724177725705IncomeTaxOrdinanace2001.pdf",
      "checked": "2026-11-01"
    },
    {
      "label": "FBR Circular 02 of 2026-27 (8 Sep 2026): surcharge stays 10% for non-salaried",
      "url": "https://download1.fbr.gov.pk/Docs/202698139527880CircularNo.2of2026-27.pdf",
      "checked": "2026-11-01"
    }
  ],
  "terminalOutput": "netIncome",
  "headlineOutput": "netIncome",
  "inputs": [
    {
      "name": "annualTurnover",
      "type": "number",
      "label": "Business or professional receipts for the year (PKR)",
      "minimum": 0
    },
    {
      "name": "annualExpenses",
      "type": "number",
      "label": "Deductible business expenses (PKR)",
      "minimum": 0
    }
  ],
  "outputs": [
    {
      "name": "taxableIncome",
      "type": "number",
      "label": "Taxable income",
      "format": "currency",
      "formula": "$round($max([0, $n(annualTurnover) - $n(annualExpenses)]), 2)"
    },
    {
      "name": "incomeTax",
      "type": "number",
      "label": "Income tax (Division I clause 1)",
      "format": "currency",
      "formula": "$round($bandedCharge(taxableIncome, [{\"upTo\": $const.band1, \"rate\": $const.rate0}, {\"upTo\": $const.band2, \"rate\": $const.rate1}, {\"upTo\": $const.band3, \"rate\": $const.rate2}, {\"upTo\": $const.band4, \"rate\": $const.rate3}, {\"upTo\": $const.band5, \"rate\": $const.rate4}, {\"upTo\": null, \"rate\": $const.rate5}]), 2)"
    },
    {
      "name": "surcharge",
      "type": "number",
      "label": "Surcharge 10% (taxable income above Rs10 million)",
      "format": "currency",
      "formula": "taxableIncome > $const.surchargeThreshold ? $round(incomeTax * $const.surchargeRate, 2) : 0"
    },
    {
      "name": "totalTax",
      "type": "number",
      "label": "Tax incl. surcharge",
      "format": "currency",
      "formula": "$round(incomeTax + surcharge, 2)"
    },
    {
      "name": "netIncome",
      "type": "number",
      "label": "Income after tax",
      "format": "currency",
      "formula": "$round($max([0, taxableIncome - totalTax]), 2)"
    }
  ],
  "testCases": [
    {
      "description": "S1 Rs3,000,000 of profit: Rs170,000 + 30% of Rs1,400,000 = Rs590,000",
      "given": {
        "annualTurnover": 5000000,
        "annualExpenses": 2000000
      },
      "expect": {
        "taxableIncome": 3000000,
        "incomeTax": 590000,
        "surcharge": 0,
        "totalTax": 590000,
        "netIncome": 2410000
      }
    },
    {
      "description": "S2 Rs12,000,000 of profit: Rs1,610,000 + 45% of Rs6,400,000, plus the 10% surcharge",
      "given": {
        "annualTurnover": 20000000,
        "annualExpenses": 8000000
      },
      "expect": {
        "incomeTax": 4490000,
        "surcharge": 449000,
        "totalTax": 4939000,
        "netIncome": 7061000
      }
    },
    {
      "description": "S3 exactly Rs10,000,000: not “exceeds”, so no surcharge",
      "given": {
        "annualTurnover": 10000000,
        "annualExpenses": 0
      },
      "expect": {
        "incomeTax": 3590000,
        "surcharge": 0
      }
    },
    {
      "description": "S4 Rs600,000 of profit: nil band",
      "given": {
        "annualTurnover": 900000,
        "annualExpenses": 300000
      },
      "expect": {
        "incomeTax": 0,
        "netIncome": 600000
      }
    },
    {
      "description": "S5 Rs1,600,000 of profit: the table’s Rs170,000",
      "given": {
        "annualTurnover": 1600000,
        "annualExpenses": 0
      },
      "expect": {
        "incomeTax": 170000
      }
    },
    {
      "description": "S6 expenses above receipts: no taxable income",
      "given": {
        "annualTurnover": 1000000,
        "annualExpenses": 1500000
      },
      "expect": {
        "taxableIncome": 0,
        "totalTax": 0,
        "netIncome": 0
      }
    }
  ],
  "spec": {
    "id": "self-employed-pakistan",
    "version": "1.0.0",
    "schema": {
      "type": "object",
      "properties": {
        "annualTurnover": {
          "type": "number",
          "minimum": 0
        },
        "annualExpenses": {
          "type": "number",
          "minimum": 0
        },
        "taxableIncome": {
          "type": "number",
          "readOnly": true
        },
        "incomeTax": {
          "type": "number",
          "readOnly": true
        },
        "surcharge": {
          "type": "number",
          "readOnly": true
        },
        "totalTax": {
          "type": "number",
          "readOnly": true
        },
        "netIncome": {
          "type": "number",
          "readOnly": true
        }
      }
    },
    "constants": {
      "band1": 600000,
      "band2": 1200000,
      "band3": 1600000,
      "band4": 3200000,
      "band5": 5600000,
      "rate0": 0,
      "rate1": 0.15,
      "rate2": 0.2,
      "rate3": 0.3,
      "rate4": 0.4,
      "rate5": 0.45,
      "surchargeRate": 0.1,
      "surchargeThreshold": 10000000
    },
    "library": {
      "layers": [
        {
          "id": "statutory",
          "define": "(\n  /* Shared statutory helpers — the canonical copy (docs/sandbox/d8-statutory-families.md §5.4).\n     DO NOT EDIT A SPEC'S INLINED COPY. Edit this file and run `npm run sync:helpers`; a vitest\n     assertion and a Java assertion both require every inlined copy to be byte-identical to this one.\n\n     Why inlined rather than referenced: the `library` section's `ref` form — a library shared\n     between models — is still proposed, gated on the model-references design (see\n     ../../../../docs/design/library/jsonata-library.md). Inlining keeps each spec self-contained,\n     which is what lets `#e=` embedding, `#share=` import and MCP forking work with no resolver.\n\n     TWO TRAPS, both of which fail SILENTLY and both of which bit during the debt-payoff build:\n\n       1. A library function sees ONLY its arguments. It cannot read the consuming document — not\n          through a bare field name, not through `$`, not through `$$`. Everything these helpers\n          need is passed in. (`$const` is late-bound and so would resolve, but relying on it would\n          couple a shared helper to one spec's constant names.)\n       2. ONE null member wrecks a whole aggregate, and the two engines disagree about how. The JS\n          reference implementation THROWS (\"Argument 1 of function sum must be an array of\n          numbers\"); the Java port can instead yield null for the entire aggregate. Neither gives a\n          partial total, and the null-yielding form is the dangerous one because it is silent. So\n          callers coerce with `$n()` below before aggregating, which makes the behaviour identical\n          in both engines — measured, not assumed: see helpers.test.ts.\n\n       3. A PATH STEP DIRECTLY ON A CALL RESULT RETURNS NOTHING in the Java engine. This matters for\n          every caller of $amortize, which is the one helper here returning an object:\n\n              $amortize(p, r, n, 0).months            -> empty in Java, 360 in JS.  WRONG\n              ($a := $amortize(p, r, n, 0); $a.months) -> 360 in both.               RIGHT\n\n          Bind the result to a variable, then step into it. The JS reference accepts both forms, so\n          this is invisible until the page is served by the real engine, and it fails as a blank\n          field rather than an error. Measured with a probe, not inferred — the field simply does\n          not appear. */\n\n  /* Number coercion with an explicit zero default. The guard against trap 2. */\n  $n := function($v) { $v = null or $not($exists($v)) ? 0 : $number($v) };\n\n  /* ISO date -> its year / month / day parts. String slicing rather than $fromMillis formatting:\n     these are statutory dates (\"2026-04-06\"), and a timezone-sensitive round-trip through millis\n     can shift the day, which silently moves a service anniversary across a band boundary. */\n  $isoY := function($d) { $number($substring($d, 0, 4)) };\n  $isoM := function($d) { $number($substring($d, 5, 2)) };\n  $isoD := function($d) { $number($substring($d, 8, 2)) };\n\n  /* Whole years of completed service between two ISO dates. Counts an anniversary as reached only\n     when the month-and-day has arrived, which is what \"completed years of service\" means in every\n     severance statute — not a 365.25-day division, whose drift crosses a 5-year band boundary in\n     the wrong direction roughly one year in four. */\n  $yearsBetween := function($from, $to) { (\n    $y := $isoY($to) - $isoY($from);\n    $beforeAnniversary := $isoM($to) < $isoM($from)\n      or ($isoM($to) = $isoM($from) and $isoD($to) < $isoD($from));\n    $beforeAnniversary ? $y - 1 : $y\n  ) };\n\n  /* Whole completed months between two ISO dates, same convention. */\n  $monthsBetween := function($from, $to) { (\n    $m := ($isoY($to) - $isoY($from)) * 12 + ($isoM($to) - $isoM($from));\n    $isoD($to) < $isoD($from) ? $m - 1 : $m\n  ) };\n\n  /* Inclusive count of days between two ISO dates — both endpoints counted, because a leave year\n     runs from its first day to its last and an employee present on both is present for both.\n     Pro-rata accrual is then $proRataDays(a, b) / $proRataDays(yearStart, yearEnd). */\n  $proRataDays := function($from, $to) {\n    ($toMillis($to) - $toMillis($from)) / 86400000 + 1\n  };\n\n  /* Progressive charge across bands. `$bands` is ordered lowest-first, each {\"upTo\": n, \"rate\": r};\n     the final band's `upTo` is omitted or null to mean \"no ceiling\". Each band's rate applies ONLY\n     to the slice of the amount inside it — the single most common error in a hand-written bracket\n     walk is applying the top rate to the whole amount. Returns 0 for a non-positive amount. */\n  $bandedCharge := function($amount, $bands) { (\n    $a := $n($amount);\n    $a <= 0 ? 0 : $reduce($bands, function($acc, $band) { (\n      $ceiling := $exists($band.upTo) and $band.upTo != null ? $band.upTo : $a;\n      $top := $ceiling < $a ? $ceiling : $a;\n      $slice := $top - $acc.floor;\n      {\n        \"floor\": $top > $acc.floor ? $top : $acc.floor,\n        \"charge\": $acc.charge + ($slice > 0 ? $slice * $n($band.rate) : 0)\n      }\n    ) }, {\"floor\": 0, \"charge\": 0}).charge\n  ) };\n\n  /* Clamp into [floor, cap]. Either bound may be omitted (null) to leave that side open — a benefit\n     with a cap and no floor is as common as one with both. */\n  $clampFloorCap := function($value, $floor, $cap) { (\n    $v := $n($value);\n    $withFloor := $exists($floor) and $floor != null and $v < $floor ? $floor : $v;\n    $exists($cap) and $cap != null and $withFloor > $cap ? $cap : $withFloor\n  ) };\n\n  /* Level annuity payment for a principal over `$months` at `$annualRatePct` nominal, compounded\n     monthly. Falls back to straight-line division at a zero rate, where the standard formula\n     divides by zero. */\n  $annuityPayment := function($principal, $annualRatePct, $months) { (\n    $p := $n($principal);\n    $m := $n($months);\n    $i := $n($annualRatePct) / 1200;\n    $m <= 0 ? 0 : ($i = 0 ? $p / $m : $p * $i * $power(1 + $i, $m) / ($power(1 + $i, $m) - 1))\n  ) };\n\n  /* Amortisation schedule: one row per month until the balance clears or `$months` is reached.\n     Returns {\"payment\", \"months\", \"totalInterest\", \"schedule\": [{month, interest, principal,\n     balance}]}. `$extra` is an optional monthly overpayment.\n\n     A real month-by-month fold rather than a closed form, because an overpayment changes every\n     later row — the same reason debt-payoff simulates. Bounded by `$months`, so it always\n     terminates. */\n  $amortize := function($principal, $annualRatePct, $months, $extra) { (\n    $i := $n($annualRatePct) / 1200;\n    $pay := $annuityPayment($principal, $annualRatePct, $months) + $n($extra);\n    $r := $reduce([1..$n($months)], function($acc, $month) {\n      $acc.balance <= 0 ? $acc : (\n        /* The running balance is kept UNROUNDED and only the emitted row is rounded. Rounding the\n           balance each month instead accumulates drift: at 200,000 over 360 months it left 2.83\n           still owing in the final row, which would break the \"final balance is zero\" invariant\n           (§7.3) and look to a reader like the schedule does not pay the loan off. Lenders compute\n           on the exact balance and adjust the last payment, which is what this does. */\n        $interest := $acc.balance * $i;\n        $due := $acc.balance + $interest < $pay ? $acc.balance + $interest : $pay;\n        $principalPart := $due - $interest;\n        $balance := $acc.balance - $principalPart;\n        {\n          \"balance\": $balance,\n          \"totalInterest\": $acc.totalInterest + $interest,\n          \"schedule\": $append($acc.schedule, [{\n            \"month\": $month,\n            \"interest\": $round($interest, 2),\n            \"principal\": $round($principalPart, 2),\n            \"balance\": $round($balance, 2)\n          }])\n        }\n      )\n    }, {\"balance\": $n($principal), \"totalInterest\": 0, \"schedule\": []});\n    {\n      \"payment\": $round($pay, 2),\n      \"months\": $count($r.schedule),\n      \"totalInterest\": $round($r.totalInterest, 2),\n      \"schedule\": [$r.schedule]\n    }\n  ) };\n\n  [\"n\", \"isoY\", \"isoM\", \"isoD\", \"yearsBetween\", \"monthsBetween\", \"proRataDays\",\n   \"bandedCharge\", \"clampFloorCap\", \"annuityPayment\", \"amortize\"]\n)\n"
        }
      ]
    },
    "defaultValues": [
      {
        "path": "$",
        "expr": "{ 'annualTurnover': 5000000, 'annualExpenses': 2000000 }"
      }
    ],
    "derivations": [
      {
        "path": "$.taxableIncome",
        "expr": "$round($max([0, $n(annualTurnover) - $n(annualExpenses)]), 2)"
      },
      {
        "path": "$.incomeTax",
        "expr": "$round($bandedCharge(taxableIncome, [{\"upTo\": $const.band1, \"rate\": $const.rate0}, {\"upTo\": $const.band2, \"rate\": $const.rate1}, {\"upTo\": $const.band3, \"rate\": $const.rate2}, {\"upTo\": $const.band4, \"rate\": $const.rate3}, {\"upTo\": $const.band5, \"rate\": $const.rate4}, {\"upTo\": null, \"rate\": $const.rate5}]), 2)"
      },
      {
        "path": "$.surcharge",
        "expr": "taxableIncome > $const.surchargeThreshold ? $round(incomeTax * $const.surchargeRate, 2) : 0"
      },
      {
        "path": "$.totalTax",
        "expr": "$round(incomeTax + surcharge, 2)"
      },
      {
        "path": "$.netIncome",
        "expr": "$round($max([0, taxableIncome - totalTax]), 2)"
      }
    ],
    "constraints": [],
    "viewDefinition": {
      "renderer": "builtin",
      "defaultView": "main",
      "views": [
        {
          "id": "main",
          "label": "Self-employed income tax",
          "layout": "vertical",
          "components": [
            {
              "id": "turnover",
              "type": "numericField",
              "label": "Business or professional receipts for the year (PKR)",
              "bind": "$.annualTurnover"
            },
            {
              "id": "expenses",
              "type": "numericField",
              "label": "Deductible business expenses (PKR)",
              "bind": "$.annualExpenses"
            },
            {
              "id": "tiles",
              "type": "group",
              "layout": "horizontal",
              "components": [
                {
                  "id": "netTile",
                  "type": "statTile",
                  "label": "Income after tax",
                  "bind": "$.netIncome",
                  "format": "currency",
                  "currency": "PKR"
                },
                {
                  "id": "taxTile",
                  "type": "statTile",
                  "label": "Tax incl. surcharge",
                  "bind": "$.totalTax",
                  "format": "currency",
                  "currency": "PKR"
                }
              ]
            },
            {
              "id": "breakdown",
              "type": "keyValueList",
              "label": "Breakdown",
              "items": [
                {
                  "label": "Taxable income",
                  "bind": "$.taxableIncome",
                  "format": "currency",
                  "currency": "PKR"
                },
                {
                  "label": "Income tax (Division I clause 1)",
                  "bind": "$.incomeTax",
                  "format": "currency",
                  "currency": "PKR"
                },
                {
                  "label": "Surcharge 10% (taxable income above Rs10 million)",
                  "bind": "$.surcharge",
                  "format": "currency",
                  "currency": "PKR"
                },
                {
                  "label": "Total tax",
                  "bind": "$.totalTax",
                  "format": "currency",
                  "currency": "PKR"
                }
              ]
            },
            {
              "id": "note",
              "type": "staticText",
              "text": "Tax year 2026-27, an individual with business or professional income and no salary. With any salary income the s.4AB proviso removes the surcharge (and above 75% salary the salaried rates apply). The 10% surcharge applies to all of the tax once taxable income exceeds Rs10 million, so crossing that line costs far more than one rupee. Not modelled: tax already withheld or collected in advance, minimum and final taxes on particular receipts, the 40% top rate for professional firms, super tax above Rs500 million, zakat and tax credits. Estimate, not tax advice."
            },
            {
              "id": "sources",
              "type": "sourceList",
              "label": "Sources",
              "layers": 2,
              "items": [
                {
                  "label": "Income Tax Ordinance 2001 (FBR, amended to 30 June 2026), First Schedule Pt I Div I(1)",
                  "url": "https://download1.fbr.gov.pk/Docs/2026724177725705IncomeTaxOrdinanace2001.pdf",
                  "date": "2026-11-01",
                  "covers": [
                    "band1",
                    "band2",
                    "band3",
                    "band4",
                    "band5",
                    "rate0",
                    "rate1",
                    "rate2",
                    "rate3",
                    "rate4",
                    "rate5"
                  ]
                },
                {
                  "label": "Income Tax Ordinance 2001 s.4AB: 10% surcharge above Rs10 million",
                  "url": "https://download1.fbr.gov.pk/Docs/2026724177725705IncomeTaxOrdinanace2001.pdf",
                  "date": "2026-11-01",
                  "covers": [
                    "surchargeRate",
                    "surchargeThreshold"
                  ]
                },
                {
                  "label": "FBR Circular 02 of 2026-27 (8 Sep 2026): surcharge stays 10% for non-salaried",
                  "url": "https://download1.fbr.gov.pk/Docs/202698139527880CircularNo.2of2026-27.pdf",
                  "date": "2026-11-01",
                  "covers": []
                }
              ]
            }
          ]
        }
      ]
    },
    "tests": [
      {
        "description": "S1 Rs3,000,000 of profit: Rs170,000 + 30% of Rs1,400,000 = Rs590,000",
        "given": {
          "$.annualTurnover": 5000000,
          "$.annualExpenses": 2000000
        },
        "expect": {
          "$.taxableIncome": 3000000,
          "$.incomeTax": 590000,
          "$.surcharge": 0,
          "$.totalTax": 590000,
          "$.netIncome": 2410000
        }
      },
      {
        "description": "S2 Rs12,000,000 of profit: Rs1,610,000 + 45% of Rs6,400,000, plus the 10% surcharge",
        "given": {
          "$.annualTurnover": 20000000,
          "$.annualExpenses": 8000000
        },
        "expect": {
          "$.incomeTax": 4490000,
          "$.surcharge": 449000,
          "$.totalTax": 4939000,
          "$.netIncome": 7061000
        }
      },
      {
        "description": "S3 exactly Rs10,000,000: not “exceeds”, so no surcharge",
        "given": {
          "$.annualTurnover": 10000000,
          "$.annualExpenses": 0
        },
        "expect": {
          "$.incomeTax": 3590000,
          "$.surcharge": 0
        }
      },
      {
        "description": "S4 Rs600,000 of profit: nil band",
        "given": {
          "$.annualTurnover": 900000,
          "$.annualExpenses": 300000
        },
        "expect": {
          "$.incomeTax": 0,
          "$.netIncome": 600000
        }
      },
      {
        "description": "S5 Rs1,600,000 of profit: the table’s Rs170,000",
        "given": {
          "$.annualTurnover": 1600000,
          "$.annualExpenses": 0
        },
        "expect": {
          "$.incomeTax": 170000
        }
      },
      {
        "description": "S6 expenses above receipts: no taxable income",
        "given": {
          "$.annualTurnover": 1000000,
          "$.annualExpenses": 1500000
        },
        "expect": {
          "$.taxableIncome": 0,
          "$.totalTax": 0,
          "$.netIncome": 0
        }
      }
    ]
  }
}