Your offer letter says Rs 150,000 a month, but your bank account shows less on payday. The difference is between gross and net salary. Understanding it helps you compare job offers fairly, plan your budget and spot mistakes on your payslip. This guide explains both terms and how to calculate your take-home pay with our Salary Calculator.
Gross salary
Gross salary is your total pay before any deductions. In Pakistan it is usually made up of:
- Basic salary
- House rent allowance, often a percentage of basic
- Medical allowance
- Conveyance or transport allowance
- Utilities and other allowances
Net salary
Net salary is what reaches your bank account after deductions:
Net salary = gross salary − deductions
Common deductions
| Deduction | What it is |
|---|---|
| Income tax | Withheld by your employer under FBR slabs |
| EOBI | Old-age benefits contribution |
| Provident fund | Your share of a retirement savings fund |
| Loan or advance repayment | If you borrowed from your employer |
| Social security | In some provinces and sectors |
Example
| Item | Monthly |
|---|---|
| Basic salary | Rs 90,000 |
| House rent | Rs 40,500 |
| Medical | Rs 9,000 |
| Conveyance | Rs 10,500 |
| Gross | Rs 150,000 |
| Income tax (example) | Rs 9,600 |
| EOBI | Rs 370 |
| Provident fund (example) | Rs 7,500 |
| Net | Rs 132,530 |
Tax depends on the current slabs; check yours with the FBR Salary Tax Calculator 2026-27. EOBI and provident fund rates depend on rules and your employer’s policy.
Why net salary matters more
Your budget runs on net salary. When you compare a new job, compare the take-home pay, not just the gross figure. A job with a higher gross but a larger provident fund deduction might pay less in hand now, though the fund is still your savings.
Annual, monthly and hourly views
Our Salary Calculator converts any salary into yearly, monthly, weekly, daily and hourly figures. This is useful when an offer is quoted annually or when you freelance by the hour. For freelancers, the Hourly ↔ Monthly Salary calculator is built for that conversion.
Check your payslip every month
Errors happen. Check that your basic, allowances and deductions match your contract and that tax looks correct. Our guide on reading a salary slip walks through each line.
Joining or leaving mid-month?
If you join a job partway through a month or take unpaid leave, your pay for that month is worked out per day. Our guide on per day salary calculation explains the methods employers use. To budget your take-home pay, try the Salary Day Countdown to plan spending until the next payday.
Frequently asked questions
What is the difference between gross and net salary?
Gross is total pay before deductions; net is what you receive after tax and other deductions.
Is house rent allowance taxable in Pakistan?
Allowances are generally part of taxable salary; check current rules or ask HR about specific exemptions.
How do I calculate net salary?
Subtract income tax and other deductions such as EOBI and provident fund from gross salary.