After-tax maturity on a bank term deposit.
After-tax maturity value
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Gross profit
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Tax on profit
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Net profit
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What the bank pays you, and what reaches your account
A term deposit, often called a fixed deposit, is the simplest investment most Pakistanis make: you lock a sum with a bank for a set tenure and the bank pays profit at an agreed rate. This calculator does two things the bank's own leaflet usually glosses over. First it compounds the profit annually, so the return builds on itself across the tenure. Second, and this is the part that surprises people, it deducts the tax that is withheld at source on the profit before showing you the maturity value. The principal is yours and is never taxed. Only the profit it earns is, and that is where the filer versus non-filer split bites.
The tool is aimed at savers comparing real after-tax outcomes rather than the headline rate, and especially at anyone weighing whether being on the Active Taxpayer List is worth it. You enter the deposit, the annual profit rate your bank quotes, the tenure in years, and your filer status, and it returns the after-tax maturity value alongside the gross profit, the tax, and the net profit.
Profit on debt and the filer gap
Profit on a bank deposit is treated in Pakistan as profit on debt, and tax on it is withheld by the bank as a final tax, meaning the bank takes it before crediting you and you generally need do nothing further. The rate splits sharply by status. For a filer the calculator applies 15 percent on the profit; for a non-filer it applies 35 percent. That is more than double, and it is the single clearest example of the cost of staying off the tax roll. These are the rates this calculator uses, set by the Federal Board of Revenue (FBR), and like all withholding rates in Pakistan they are revisited in the annual Finance Act, so confirm the current figure before you rely on a net number.
Crucially the tax falls on the profit alone. The calculator compounds your deposit to its gross maturity, strips out the profit portion, taxes only that profit at your status rate, and adds the net profit back to your untouched principal. Your original capital comes home in full.
PKR 1 million for three years at 13 percent, as a filer
Load the defaults: a PKR 1 million deposit, a 13 percent annual profit rate, a three-year tenure, and filer status. Compounded annually, PKR 1 million grows to about PKR 1,442,897, so the gross profit is roughly PKR 442,897. As a filer the withholding is 15 percent of that profit, about PKR 66,435, leaving net profit near PKR 376,462. Your after-tax maturity value is therefore close to PKR 1,376,462.
| Line | Filer (15%) | Non-filer (35%) |
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The result box prints the filer maturity as "Rs 1,376,462". Switch the status to non-filer and the same deposit returns about PKR 1,287,883, because the tax jumps from roughly PKR 66,435 to about PKR 155,014. The bars below put the two side by side.
The chart below shows how the profit splits between net profit kept and tax withheld for your selected filer status.
Reading the result, and where it can mislead
A useful judgement: filing a return purely to access the 15 percent rate often pays for itself many times over on a sizeable deposit, as the PKR 88,579 difference in net profit above shows on just PKR 1 million over three years. Scale that up and the case for getting onto the Active Taxpayer List is overwhelming for anyone with meaningful savings. The common mistake is comparing a bank's advertised rate against a National Savings certificate without adjusting for tax, since some savings instruments carry reduced rates for pensioners and seniors. Always compare net of withholding, not gross.
One modelling caveat: this calculator compounds profit once a year, while many banks pay profit monthly or quarterly and may calculate on a slightly different basis, so treat the output as a close estimate rather than the exact figure on your advice slip. And because the 15 percent and 35 percent rates can move with the budget, verify your current rate with your bank or the FBR before locking a long tenure.
Is the withholding the end of my tax, or do I report it again?
For most individuals profit on debt is a final tax, so the amount the bank withholds settles your liability on that profit and you simply report it for the record. You are not taxed twice. Higher-income individuals can face different treatment, so if your profit income is large, check whether the final-tax regime still applies to you.
Does a longer tenure change the tax rate?
No, the rate depends on your filer status, not the tenure. A longer tenure grows the profit through compounding, which means more rupees of tax in absolute terms, but the percentage stays 15 percent for a filer or 35 percent for a non-filer as the calculator models it. Stretching three years to five at 13 percent simply produces a larger gross profit, taxed at the same rate.