Provident Fund Calculator — Pakistan 2026
Project your provident fund balance from employee and employer contributions on basic salary, the fund's profit rate and salary growth, and see the tax-free limits.
| Monthly contribution now (you / employer) | — |
|---|---|
| Your contributions over the period | — |
| Employer contributions over the period | — |
| Profit earned | — |
| Employer share within the tax-free limit? | — |
| Balance as months of final salary | — |
Year by year
In short
In Pakistan a provident fund takes a fixed percentage of basic salary from the employee (commonly 8.33% or 10%) matched by the employer, credits annual profit of around 10–15%, and pays the whole balance tax-free on leaving if the fund is recognised by the FBR; the employer's contribution is tax-free up to the lower of 10% of salary or PKR 150,000 a year.
Who this is for: Employees in Pakistan projecting their PF balance and checking the tax-free limits; HR teams explaining the benefit.
How provident funds work in Pakistan
- Contributions: the employee contributes a fixed percentage of basic salary — 8.33% (one-twelfth) or 10% are the common rates — and the employer matches it. Both are credited to the member's account monthly.
- Profit: the fund trustees invest (mostly government securities, bank deposits, some funds) and credit profit annually, typically in line with policy rates — 10–15% in recent years.
- Withdrawal: the full balance (both shares plus profit) is paid on leaving, retirement or death; many funds allow partial withdrawals or loans for housing, medical or education. Some employers vest their share only after a minimum service period — check the trust deed.
- Tax: for a recognised provident fund (approved by the Commissioner), the employer's contribution up to the lower of 10% of salary or PKR 150,000 a year is not taxed as salary, profit is exempt up to 16% or the SBP rate + 1%, and the final payout is tax-free. The employee's contribution qualifies for a tax credit.
Provident fund and gratuity are different benefits: gratuity is a lump sum the employer pays from its own funds at 30 days' wages per year; PF is a savings account both sides pay into. Some employers offer one, some both.
See also: EOBI Pension Calculator — Pakistan.
Assumptions
- Monthly contributions = basic × employee % and × employer %, added before compounding at the profit rate monthly; basic grows annually by the raise %.
- Tax-free check: employer contribution ≤ lower of 10% of annual basic or PKR 150,000.
- Vesting rules, loans and withdrawals are not modelled.
Worked example
Monthly contributions start at PKR 5,000 + 5,000. Over 10 years you contribute about PKR 869,000, the employer the same, and profit adds roughly PKR 1.28 million → balance ≈ PKR 3.02 million, about 25 months of your final basic salary.
Frequently asked questions
Is provident fund mandatory in Pakistan?
Not by general law for private employers (except where the Standing Orders or a wage board require it); it is a contractual benefit, but most medium and large employers provide one.
Is PF withdrawal taxed?
Not from a recognised (approved) fund. From an unrecognised fund the employer's contributions and profit are taxed as salary when paid out.
Can I take a loan from my provident fund?
Most trust deeds allow a loan or non-refundable withdrawal of up to the member's own contributions (sometimes more) for housing, marriage, medical or education.
What happens to my PF if I change jobs?
It is paid out when you leave; there is no transfer between employers' funds in Pakistan. Reinvest it in the new employer's scheme or a voluntary pension scheme (VPS) to keep the tax benefit.
What percentage is provident fund in Pakistan?
Commonly 8.33% of basic salary from the employee, matched by the employer; some employers use 10%.
Is provident fund taxable in Pakistan?
Not when paid out from a recognised fund; employer contributions above 10% of salary or PKR 150,000 a year are taxed as salary.
Related calculators
See all Pakistan calculators → · All free online calculators
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