1. What is the Pension Calculation Formula?

The pension calculation formula for Pakistan estimates retirement benefits based on last drawn salary and years of service. It provides a standardized method to determine pension amounts for government employees and other eligible individuals.

2. How Does the Calculator Work?

The calculator uses the pension formula:

Where:

• \( Last Pay \) — Final drawn salary before retirement (PKR)
• \( Service Years \) — Total years of service
• \( \frac{7}{300} \) — Standard pension multiplier in Pakistan

Explanation: The formula calculates the pension amount by taking 7/300th of the last pay and multiplying it by the total years of service.

3. Importance of Pension Calculation

Details: Accurate pension calculation is crucial for retirement planning, ensuring financial security for retired employees, and proper budgeting for pension funds.

4. Using the Calculator

Tips: Enter last pay in Pakistani Rupees (PKR) and service years. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Who is eligible for this pension calculation?
A: This formula is typically used for government employees in Pakistan. Private sector pensions may follow different rules.

Q2: Is there a minimum service requirement?
A: Yes, typically a minimum of 10 years of service is required to be eligible for pension benefits.

Q3: Are there any maximum limits on pension?
A: Yes, pension is usually capped at 70% of the last pay drawn, regardless of service years.

Q4: How often is pension paid?
A: Pension is typically paid monthly to eligible retirees.

Q5: Are there any deductions from pension?
A: Yes, various deductions like income tax (if applicable) and medical insurance premiums may be deducted from the gross pension amount.