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Pakistan country pack — this guide covers Pakistan-specific statutory rules. Octal HR is configurable for other regions too.

Overview of provincial social security

Pakistan's four provinces each run their own social security scheme for industrial and commercial workers. These schemes provide medical, disability, and death benefits. Employers are required to register and contribute monthly — the rate and wage ceiling vary by province.

ProvinceInstitutionEmployer rateEmployee rateWage ceiling (2025-26)
PunjabPESSI — Punjab Employees Social Security Institution6%1%PKR 30,000/month
SindhSESSI — Sindh Employees Social Security Institution6%1%PKR 30,000/month
KPKESSI — Employees Social Security Institution (KPK)6%1%PKR 30,000/month
BalochistanBESSI — Balochistan Employees Social Security Institution6%1%PKR 25,000/month
Wage ceiling: The contribution is calculated on actual wages up to the ceiling. An employee earning PKR 50,000/month in Punjab: PESSI employer = 6% × 30,000 = PKR 1,800. Wages above the ceiling are ignored for PESSI calculation.
Verify current rates: Social security contribution rates and ceilings are set by provincial legislation and can change annually. Always verify current rates on the respective provincial social security website before each fiscal year.

Applicability

Social security obligations are generally triggered for establishments that:

  • Employ 5 or more persons (varies by province)
  • Operate in covered industries (check the provincial SS schedule)
  • Are located within the province (for employees at a specific work site)

Multi-province employers must register separately in each province where they have employees. Each registration produces a separate employer number.

Configuring PESSI/SESSI in Octal HR

1
Go to Settings → Payroll → Statutory Deductions → Social Security.
2
Click Add Province and select the province (Punjab, Sindh, KPK, or Balochistan).
3
Enter your Employer Registration Number for that province's social security institution.
4
Confirm the employer rate (default 6%), employee rate (default 1%), and wage ceiling.
5
Click Save. The province configuration is now active.
6
Assign each employee to their applicable province under Employee → Tax Information → Social Security Province. Employees at different work locations may be assigned different provinces.

Social security contribution report

After payroll finalization, generate the challan report from Payroll → Reports → Social Security Challan. Select the province and period. The report includes:

  • Each employee's social security registration number
  • Wages on which contribution is calculated
  • Employee and employer share amounts
  • Total payable to the institution

Social security challans must be submitted and paid by the 15th of the following month.

Missing registration numbers: If an employee does not yet have a social security card, they should apply through the provincial institution. Contributions should still be deposited in their name during the registration process.

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