Pakistan

Employment taxes

• Income tax: Pakistan uses a progressive income tax system with tax brackets ranging from 0% to 35% depending on annual income.
• Payroll contribution: Employees usually contribute to social security with 1% (varies by province). and to EOBI (Employee Old-Age Benefits Institution) with 1% of the minimum wage.
• Employees receive their salary net of taxes, which employers typically handle on their behalf.

Leave policy

• Annual leave: Minimum 14 days of paid vacation per year.
• Public holidays: Pakistan offers 17 public holidays annually.
• Sick leave: Full-time employees in Pakistan are entitled to 16 days of sick leave. Sick leave is paid at the employee's full rate of wages.
• Maternity leave: 12 weeks of paid maternity leave, usually paid at the employee's full wages by the employeer.
• Paternity leave: Not nationwide, but government employees receive 10 days private companies often follow similar informal standards.
• Parental leave: In Pakistan, no law covers parental leave.

Employment termination

• Notice period: Standard 30 days unless the contract specifies more.
• Severance: In Pakistan, all employees who are terminated are entitled to severance pay of 30 days’ wages per year of service, unless it was for misconduct.
• Grounds for termination: Misconduct, redundancy, or performance-based reasons must be documented.

Hiring and contracts

• Written contracts are mandatory and must be in English.
• Contracts usually include: role, salary, working hours, probation period, and notice rules.
• Types of contracts: Fixed-term and indefinite contracts are both common.
• Probation period: Up to 3 months.

Payroll and salary payments

• Payroll cycle: Usually monthly, paid at the end of the month.
• Salaries must be paid in PKR (Pakistani Rupee).
• National minimum wage: Approximately PKR 40,000 per month (EUR 122/USD 141).
• Employers must provide detailed pay slips with tax and deduction breakdowns.

Benefits

Mandatory

• Social Security contributions (health & disability coverage)
• EOBI pension contributions
• Paid leave (annual, sick, maternity)
• Public holidays

Optional

• Private health insurance
• Meal allowances
• Transportation stipends
• Mobile and internet allowance
• Flexible working hours or remote days
• Professional development budgets

Monthly living cost (Islamabad Edition)

• Rent (1-bedroom apartment): PKR 55,000-90,000 (€180-295 / $195-320)
• Utilities: PKR 15,000-25,000 (€50-82 / $54-90)
• Groceries: PKR 25,000-40,000 (€82-131 / $90-143)
• Public transport: PKR 2,000-5,000 (€7-16 / $7-18)
• Eating out: Very affordable - PKR 600-1,500 per meal (€2-5 / $2-5.50)

Overall, you can live well on a moderate salary.

How to get a local ID number

Pakistan’s national ID is called CNIC (Computerized National Identity Card). For foreign residents, the equivalent is the NICOP or POC depending on status.

For foreign employees:

• You’ll receive a Work Visa first.
• After entering Pakistan, you can apply for an Alien Registration Card (ARC).
• Employers usually assist with documentation, registration, and local ID processes.

Remote workers (not relocating) do not need a CNIC or ARC.

Social security registration

Employees are registered with:

• Provincial Social Security Institutions (provides medical, disablement benefits).
• EOBI (Employee Old-Age Benefits Institution) for pensions.

Employers handle the registration automatically once an employment contract begins.

Banking

You’ll need a local bank account for salary payments. Popular banks include:

• HBL (Habib Bank Ltd.)
• MCB Bank
• UBL (United Bank Ltd.)
• Allied Bank
• Standard Chartered Pakistan

Opening an account usually requires: Passport, valid work visa, employer letter, local address.

Housing and rental process

• Finding an apartment in Pakistan is straightforward, especially in major cities.
• Most rentals require 1–3 months’ rent upfront as deposit.
• Leases are typically 12 months.
• Real estate agents are commonly involved (and take a small fee).

Tenant rights:

• Landlords cannot increase rent arbitrarily, increases are regulated.
• Tenants must be given notice before eviction.
• Maintenance responsibilities are shared (structure = landlord, utilities = tenant).

Healthcare system

Pakistan has public hospitals, but expats and international workers usually prefer private healthcare, which is affordable and high-quality.

Private hospitals/clinics in Islamabad & Karachi provide:

• General care
• Specialists
• Emergency services
• Diagnostics

Employers often provide private health insurance as an added benefit.

Driving and public transport

• Pakistan uses left-hand driving.
• Roads in major cities are busy but improving rapidly.
• Ride-hailing apps like Careem and Uber are widely used and cheap.
• Public transport options include: Buses and metrobus systems, taxis, and ride-hailing bikes (fastest for traffic-heavy areas).

Emergency and important contacts

• Police: 15
• Ambulance/Rescue: 1122
• Fire: 16
• Traffic helpline: 1915

Work permit and visa requirements

All foreign citizens need a work permit and a visa to work and live in Pakistan. The rules are following:

1. First you need a job offer from a Pakistan-based employer
2. Employer applies for the work permit
3. Once approved, you apply for the visa at the Embassy/Consulate
4. On arrival, long-term work/residence permits can be extended

The Work Visa is typically issued for 1 year and renewable.

Pakistan has become increasingly open to foreign professionals, especially in IT, engineering, and business services.

Business culture and work norms

• People are friendly and relationship-oriented
• English is widely used
• Hierarchy exists, but collaboration is common
• Tea (“chai breaks”) are practically a cultural institution
• Team loyalty is strong once trust is built