EOBI is Pakistan’s old-age benefits scheme. Employers above the applicable size threshold must register, enrol eligible employees, contribute monthly on their behalf, and file the contribution challan. It sits alongside — not instead of — provincial social security, which is SESSI in Sindh and PESSI in Punjab.
Two schemes, often confused
EOBI is federal and covers old-age pension and related benefits. Provincial social security is separate, administered by the province where the establishment operates, and funds medical and related benefits.
A business with branches in Karachi and Lahore is therefore dealing with EOBI plus SESSI for the Sindh staff and PESSI for the Punjab staff. Treating them as one national obligation is the most common compliance mistake we see.
How contributions are structured
Contributions have an employer side and an employee side, and they are not always symmetrical. Depending on the scheme they may be a percentage of wages with a ceiling, or a flat amount per employee.
The detail that causes reconciliation pain is the base: which earnings count towards the contribution. If an allowance is included when it should not be, or excluded when it should not be, the error repeats every month and only surfaces in an audit.
The monthly routine
The sequence is stable even as rates change.
- Confirm the eligible employee list — new joiners in, leavers out.
- Compute employer and employee contributions on the correct wage base.
- Deduct the employee share through payroll in the same run as tax.
- Generate and deposit the challan for each scheme within the deadline.
- File and retain the contribution statement and register.
Where automation helps most
The genuinely error-prone parts are eligibility drift and the wage base, not the arithmetic. A system that derives eligibility from the employee record — join date, branch province, employment type — picks up a mid-month joiner without anyone maintaining a separate list, and a system that computes contributions inside the payroll run guarantees the numbers you file are the numbers you actually paid.
Questions
Do EOBI and SESSI both apply to the same employee?
Yes, they are separate schemes with separate obligations. EOBI is federal; provincial social security applies based on where the establishment is located — SESSI in Sindh, PESSI in Punjab.
Is the employee’s share deducted from salary?
The employee share is deducted through payroll, while the employer share is an additional cost to the business. Both are deposited by the employer.
General information for Pakistani employers, not legal or tax advice. Statutory rates change with each Finance Act — verify current figures before relying on them.
Related reading
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