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PAKISTAN PENSION FUND & PAKISTAN ISMALIC PENSION FUND

(under Voluntary Pension Rules 2005 (VPS)

Salient Features of the schemes of the

Self-contributory pensions saving cum investment schemes, Employers can contribute too

Individualized asset allocation (High Volatility, Medium Volatility, Low Volatility, Lower Volatility

and 2 lifecycle allocation plans.

Islamic mode also available unlike Provident Fund/Pension Plans offered by Insurance Cos. Tax rebate allowed on amount invested in VPS upto a maximum of 20% of individuals annualized

taxable income OR actual investment, whichever is lower. Catch-up rebates allowed on contributions

for persons joining at age of 41 or above

Creation of personal pension accounts on individuals name

Portability of individual pension accounts from one employer to another and from one Pension FundManager to another

Minimum investment amount of Rs.1,000/-, No maximum contribution limit

What makes VPS attractive

Wealth Creation (Individual can decide his own asset allocation plan)

Asset valuation on fair value principle for all participants

Upto 50% tax free withdrawal at the time of exit from scheme (between the age 60 & 70)

Post retirement options: Annuity plan OR Income Drawdown Plan

Portable scheme in case of job mobility

Administration Outsourced if Company opts as retirement benefit plan

Transparency & Confidence of investors, as sub funds unit prices are announced daily and a monthly

performance report issued

10 different investment choices available each in Conventional & Islamic Pension Fund

Flexibility, individual can change investment plans twice an year and can also change Pension Fund

Manager once an year

Accidental death & disability insurance cover (free/complementary) upto 100 times of average monthlycontribution and extremely low cost optional insurance covers for untimely death, emergency

hospitalization.

Arif Habib Pension Funds:

Pakistan Pension Fund (Conventional )

Pakistan Islamic Pension Fund (Sharia compliant)

Each Pension Funds comprises of three sub-funds:

Equity Sub-Fund

Debt Sub-Fund

Money Market Sub-Fund

Additional funds like Real Estate and International investments may be added in future

Asset Allocation Plans:

Sr. No. Plans Equity Sub-

Fund

Debt Sub-

Fund

Money

Market

1 High Volatility Min 65% Min 20% Nil

2 Medium Volatility Min 35% Min 40% Min 10%

3 Low Volatility Min 10% Min 60% Min 15%

4 Lower Volatility Nil Min 40% Min 40%

5 Aggressive Lifecycle 80% allocation in equity tillage 50 and then gradual

reduction

6 Progressive Lifecycle 80% allocation for age 20

and gradual reduction eachyear until age 60

*Volatility here means the downward or upwards change in Principal amount invested owing to

change in price of the securities in the portfolio of a sub-fund.

Ideal Scheme - Progressive Lifecycle Plan

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Invest largely in high yielding inflation protected Equity at younger ages and move progressively to stable Debtand Money Market funds as age increases.

Tax Credit for Individuals (Section 63 of I.T. Ordinance)

Salaried individuals can get an annual tax credit (depending upon their respective tax slabs)

Self employed individuals can get an annual tax credit (depending upon their respective tax slabs)

Tax rebate can be calculated as per investors own tax slab on the basis of lower of the following there

a) Actual amount invested in Pension Fund OR

b) 20% of individuals annual taxable income

Lower of above two is multiplied by income tax slab to arrive at tax rebate amount. Company can

adjust tax credit/rebate (as per FBR Circular 1 of 2007)

Persons joining the scheme at age 41 & above get catch up rebates as Income tax law allows 2%

investment allowance for each year above 40 years of age (till the year 2016) subject to the maximumcap of 50% of their taxable income of the preceding year.

Investment Risks and Tax Implication

All investments in Pension Fund are subject to market risks. The value of such investments may depreciate as

well as appreciate, subject to market fluctuations and risks inherent in all such investments. Investors shouldread the Offering Document carefully to understand thinvestment policies, risks and tax implication and should

consult their legal, financial or tax adviser before making any investment decisions. Withdrawls from thePension Fund before the retirement age are subject to tax under the provisions of the Income Tax Ordinance,

2001.