Withholding Tax on Brokerage and Commission Calculator 2026-27

When a business pays brokerage or commission in Pakistan, it must deduct income tax from that payment under Section 233 of the Income Tax Ordinance. For Tax Year 2026-27 the rate is 12% for most agents, 10% for advertising agents and 8% for small life insurance agents, and it doubles for anyone who is not a filer. Enter the commission above to see how much will be deducted.

Withholding tax rates on brokerage and commission for 2026-27

• Advertising agents: 10% for filers, 20% for non-filers.
• Life insurance agents earning less than Rs. 500,000 in commission a year: 8% for filers, 16% for non-filers.
• Everyone else, such as property dealers, sales agents and distributors paid on commission: 12% for filers, 24% for non-filers.

These rates are unchanged from 2025-26. Filer here means appearing on the FBR’s Active Taxpayers List on the day the payment is made.

How do I use the commission tax calculator?

1. Enter the commission and pick your options. Type the annual brokerage or commission amount, choose 2026-2027, set Filer to Yes or No, and select the type of agent.

2. Click Calculate Tax. The result shows the commission and the income tax to be withheld.

How much is deducted from a Rs. 500,000 commission?

• A property dealer who is a filer: 12%, or Rs. 60,000.
• The same dealer as a non-filer: 24%, or Rs. 120,000.
• An advertising agency that is a filer, on Rs. 1,000,000 of commission: 10%, or Rs. 100,000.
• A life insurance agent who is a filer, on Rs. 400,000 for the year: 8%, or Rs. 32,000.

For a commission agent, filer status is worth Rs. 60,000 on a Rs. 500,000 cheque. Registering starts with a National Tax Number from the FBR, and the filer vs non-filer guide shows how the same doubling applies to other payments.

Who has to deduct the tax?

The payer does. Companies, AOPs, government bodies and other prescribed persons that pay brokerage or commission must deduct the tax, deposit it with the FBR and give the agent a certificate. Agents then claim that tax in their own return. The wider system is explained in how withholding tax works in Pakistan.

Is commission income taxed again in your return?

Your commission is business income, so it goes into your return with your other earnings and the tax already deducted is set against the result. To see what your total business profit would cost under the 2026-27 slabs, use the business income tax calculator. Agents who also sell goods should check the deduction on those sales with the withholding tax on supply of goods calculator.

Did the 2026-27 budget change commission tax?

No. The Section 233 rates stayed the same under the Finance Act 2026. The changes that did happen are listed in the Federal Budget 2026-27 income tax summary.

This calculator gives an estimate based on the Finance Act 2026. Your agreement with the payer and your filer status on the payment date decide the actual deduction, so confirm with the FBR or a tax adviser.

Earn on commission and want it handled?

We register agents for NTN, keep them on the Active Taxpayers List and file the returns that claim back their deductions. Talk to our tax advisers for agents and brokers, or check other figures on the Pakistan tax calculator home page.