Salary Calculator
Pakistan

Our Pakistan salary calculator helps businesses accurately estimate employee take-home pay while ensuring compliance with local tax laws and social security requirements.

Simply enter the employee’s gross salary, and the calculator will apply mandatory deductions, including income tax, social security contributions, and other applicable withholdings.

After accounting for all statutory deductions, the calculator provides the net salary—giving businesses a clear understanding of total employment costs and payroll obligations in Pakistan.

The total cost of salary in Pakistan includes income tax and mandatory social security contributions, which both employers and employees must cover. 

The gross salary is the salary before any deductions and serves as the basis for calculating taxes and contributions. Employers in Pakistan are required to contribute 5% of the minimum wage to the Employees’ Old-Age Benefits Institution (EOBI), while employees contribute 1%.

Income tax for employees follows a progressive tax system, where the tax rate increases based on the income level. Employers must deduct and submit the applicable income tax on behalf of their employees. 

Income taxes in Pakistan are structured progressively, meaning the tax rate increases with higher income levels. The following are the income tax rates:

-Income up to PKR 600,000: Tax rate of 0%.

-Income from PKR 600,001 to PKR 1,200,000: Tax rate of 5% on the amount exceeding PKR 600,000. 

-Income from PKR 1,200,001 to PKR 2,200,000: PKR 30,000 + tax rate of 15% on the amount exceeding PKR 1,200,000.

-Income from PKR 2,200,001 to PKR 3,200,000: PKR 180,000 + tax rate of 25% on the amount exceeding PKR 2,200,000.

-Income from PKR 3,200,001 to PKR 4,100,000: PKR 430,000 + tax rate of 30% on the amount exceeding PKR 3,200,000.

-Income over PKR 4,100,001: PKR 700,000 + tax rate of 35% on the amount exceeding PKR 4,100,000.

*Please note that these rates can vary based on legislative changes.

Employers in Pakistan must provide mandatory employment benefits to their employees to ensure their financial security and social protection. These benefits include contributions to social security, which employers must submit to the relevant authorities. 

In addition to this, employees in Pakistan are entitled to paid annual leave, public holidays, sick leave, and maternity/paternity leave. Employers must also ensure workplace safety and provide compensation in case of work-related injuries. 

Finally, employers in Pakistan must contribute to the Employees’ Old-Age Benefits Institution (EOBI), which provides pension upon retirement. Some industries may also require additional benefits, such as gratuity or provident funds, depending on company policies and employment agreements. 

Many employers in Pakistan offer extra employee benefits to improve employee satisfaction and retention. These extra benefits often depend on the company’s policies, industry, and budget.

Some common extra benefits include private health insurance, which provides extended medical coverage beyond government healthcare. Many companies also offer performance-based bonuses and fuel or travel allowances to support their employees’ daily expenses.

In addition, larger organisations may provide housing allowances, educational support for employees or their children, subsidised meals, and other benefits that enhance the employee experience. 

Gross and net salary in Pakistan refer to different stages of an employee’s earnings.

The gross salary is the full amount an employee is entitled to before any deductions. It includes the base salary, along with any bonuses or allowances, but does not yet have taxes or contributions deducted.

The net salary is the final amount the employee takes home after all necessary deductions have been made. These deductions include income tax, social security contributions, and other mandatory withholdings. Once these withholdings are subtracted, the employee gets the net salary in their bank account for every month of work.