Tax on freelancers in Pakistan who bring export income home through a bank is 0.25% of the rupee amount if they are registered with the Pakistan Software Export Board (PSEB) as IT or IT enabled exporters, and 1% otherwise. The bank deducts it under section 154A and, subject to conditions, it is the final tax on that income. The 0.25% rate runs until tax year 2029.
The bigger costs come before the tax: Fiverr keeps 20%, Upwork 0% to 15%, and withdrawal fees and currency margins take more. On a $500 Fiverr order withdrawn through Payoneer, you keep about Rs 105,607, or about three quarters of the order at the State Bank rate.
How freelancer income is taxed in Pakistan
Section 154A of the Income Tax Ordinance applies to export of services. When foreign currency for your services is converted and credited to your account, the bank deducts:
| Who | Rate | Nature |
|---|---|---|
| IT or IT enabled services, registered with PSEB | 0.25% | Final, subject to conditions |
| Any other export of services | 1% | Final, subject to conditions |
These rates are the same whether or not you are on the Active Taxpayers List. Rule 10(ca) of the Tenth Schedule keeps exports out of the doubling that applies to most other deductions.
Because the tax is final, the export income is not added to your other income or taxed again at slab rates. You should still file an income tax return and declare it, which also puts you on the ATL. Being on the ATL cuts tax on property, cars, cash withdrawals and more, as the non-filer tax calculator shows.
Worked example: a direct client paying $2,000
Sara is a PSEB registered developer. A client in the UAE pays her $2,000 straight into her bank's foreign currency account, and she converts it at the State Bank rate of Rs 277.01 from 8 October 2026.
- Rupee amount: 2,000 × Rs 277.01 = Rs 554,020
- Tax at 0.25%: Rs 1,385.05
- In her account: Rs 552,635
Without PSEB registration the tax would be 1%, or Rs 5,540.20, four times as much on this one payment. Share your PSEB registration with your bank so it applies the lower rate.
Worked example: Fiverr through Payoneer
A $500 order on Fiverr, withdrawn to a Payoneer account and then to a Pakistani bank:
- Fiverr fee 20%: $100, leaving $400
- Fiverr's Payoneer withdrawal fee: $3, leaving $397
- At Rs 277.01: Rs 109,972.97
- Payoneer's conversion margin, taken at its published maximum of 3%: Rs 3,299.19
- In your bank: Rs 106,673.78, then 1% tax of Rs 1,066.74
- Kept: Rs 105,607.04, about three quarters of the order
Fees that cost more than the tax
- Platform fee. Fiverr takes 20% of every order, extra and tip. Upwork sets a Freelancer Service Fee between 0% and 15% on each contract. Details are on the Fiverr fee calculator and the Upwork fee calculator.
- Withdrawal fee. A flat dollar fee each time you withdraw, from $0.99 (Upwork direct to local bank) to $50 (Upwork dollar wire). Fewer, larger withdrawals cost less.
- Currency margin. Payoneer's pricing page says withdrawing to a bank in another currency costs up to 3%. Banks and Upwork also convert below the interbank rate. Compare the rupees that arrive with the interbank rate on that day and put the difference in the calculator.
- Payoneer annual fee. $29.95 a year if you receive less than $2,000 in 12 months.
PSEB registration carries a fee that PSEB sets on its own portal. It is a yearly cost rather than a per-payment one, so it is not in the calculator.
If you invoice local clients for services, provincial sales tax may apply; see the sales tax on services calculator. Earning outside the IT export regime? The business income tax calculator uses the normal slabs.
Platforms and clients abroad ask for your 24 character IBAN; work it out for HBL, MCB, UBL, Meezan Bank or Allied Bank with the IBAN generator.
Upwork earnings in rupees at a 10% fee
Direct to Local Bank, one withdrawal, Rs 277.01 a dollar, no conversion margin entered.
| Billed | Upwork fee | After withdrawal fee ($0.99) | In hand, 1% tax | In hand, PSEB 0.25% |
|---|---|---|---|---|
| $50 | $5.00 | $44.01 | Rs 12,069 | Rs 12,161 |
| $100 | $10.00 | $89.01 | Rs 24,410 | Rs 24,595 |
| $250 | $25.00 | $224.01 | Rs 61,432 | Rs 61,898 |
| $500 | $50.00 | $449.01 | Rs 123,136 | Rs 124,069 |
| $1,000 | $100.00 | $899.01 | Rs 246,544 | Rs 248,412 |
| $2,000 | $200.00 | $1,799.01 | Rs 493,360 | Rs 497,098 |
The dollar rate in the calculator is the interbank close on 29 September 2026. Change it to the rate on your own bank advice. Tax rules come from section 154A and the FBR rate card for 2026-27. Rules on selling goods online are different: see the Daraz profit calculator.
Freelancer tax questions
How much tax do freelancers pay in Pakistan?
0.25% of the foreign exchange brought home if registered with PSEB for IT or IT enabled services, and 1% in other cases, under section 154A. The bank deducts it when the money is converted. It is final tax on that income, subject to conditions, and the rates apply until tax year 2029.
Do freelancers need to file a tax return?
Yes, filing is still advisable and often required. The return declares the export income taxed at the final rate and puts you on the Active Taxpayers List. Without it you pay non-filer rates on property, cars, cash withdrawals and other transactions.
Is freelance income taxed at salary slab rates?
No, not if it comes in as export proceeds through a bank. The 0.25% or 1% deducted under section 154A is final tax, so it is kept out of the slab calculation. Income from local clients is taxed differently, under the normal rules for business income.
Does a non-filer freelancer pay double tax on remittances?
No. Export proceeds under section 154A are excluded from the non-filer increase by Rule 10(ca) of the Tenth Schedule. A non-filer freelancer pays the same 0.25% or 1% as a filer on the export income itself.
How much does Payoneer charge to withdraw to a Pakistani bank?
Payoneer's pricing page lists up to 3% for withdrawing to a bank account in a different currency, which is the case when dollars go to a rupee account. The rate you see can be lower. Fiverr also charges $3 to send earnings to a Payoneer account, and Upwork $2.
Last reviewed 9 October 2026. Results are estimates; official notices always take precedence.