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NIT Islamic Pension Fund is established in Pakistan as a Voluntary Pension Fund through a Trust Deed, dated May 14, 2015 on the basis of Wakalah tul Istismar(Investmetn Agency Agreement), entered in between National Investment Trust Limited in its capacity as the Pension Fund Manager and Central Depository Company of Pakistan Limited in its capacity as the Trustee and authorized under the Voluntary Pension System (VPS) Rules, 2005.

Offering Document

1st Supplementary Offering Document

Fund Manager Report

The Pension Fund shall initially consist of three (3) Sub-Funds to be called

i. NIT-IPF Equity Sub-Fund (the “Equity Sub-Fund”)
ii. NIT-IPF Debt Sub-Fund (the “Debt Sub-Fund”) 
iii. NIT-IPF Money Market Sub-Fund (the “Money Market Sub-Fund”)

After successfully managing the above mentioned Sub-Funds, the Pension Fund Manager may, with the approval of the Commission, launch other Sub-Funds through a Supplementary Trust Deed and a Supplementary Offering Document for investments in other asset classes, including securitized investment in real estate or in assets outside Pakistan (for avoidance of doubt, additional Sub-Funds may include combinations of new and existing classes of assets). Thereafter, any reference to the Sub-Funds in the Trust Deed or the Offering Document shall be construed to include any such new Sub-Fund.


The objective of introducing NIT Islamic Pension Fund is to provide individuals with a portable, individualized, Shariah Compliant, funded (based on defined contribution) and flexible Islamic pension scheme which is managed by professional investment manager to assist them to plan and provide for their retirement. . The design of the scheme empowers the participants to decide how much to invest in their pensions, and how to invest it, as well as to continue investing in their pension accounts even if they change jobs.

Salient Feature of Islamic Pension Fund

Term Sheet

Fund Name NIT Islamic Pension Fund (NIT-IPF)
Fund Structure Unit Trust Scheme consisting of Sub-Funds under the VPS Rules 2005 on the basis of Wakalah tul Istismar(Investment Agency Agreement)
Fund Objective To provide a secure source of savings and regular income after retirement to the Participants
Eligibility Every Pakistani national over the age of 18 years holding a valid CNIC or NICOP
Minimum Contribution The minimum amount to open an account is Rs. 1,000/- and the minimum amount of contribution to an existing account is Rs. 500/- per transaction. There is no maximum limit of contribution. However, Tax Credit will be available to the extent specified in the income Tax Ordinance, 2001.
Contribution Frequency Annual, semi-Annual, quarterly, monthly or as desired by the
Contribution Mechanism Cheque, bank draft, pay order (crossed account payee only), titled “CDC - Trustee NIT Islamic Pension Fund” payable to the Trustee on any Dealing Day. Any other electronic form of Transfer.

Contribution in the form of Cash or any bearer instruments shall not be made and accepted.

*The Pension Fund Manager may make arrangements with Banks for online transfers from time to time. Such Arrangements (if any) will be communicated to Participants through the company’s website.
Investment Mechanism Takaful premium (for optional Takaful covers) shall be deducted from Contributions made by the Participant, followed by deduction unless waived of applicable Front-end Fee. The remaining Contribution amount is then credited to the Participant’s Individual Pension Account and is invested in the underlying Sub-Funds of the NIT Islamic Pension Fund as per the Allocation Scheme selected by the Participant
Allocation of Contributions & Allocation Schemes Contributions shall be allocated among the Units of Sub-Funds at Net Asset Value, as per the selected Allocation Scheme, from amongst the following Five (5) Schemes being offered by the Pension Fund Manager.
Equity Sub- Fund Debt Sub- Fund Money Market Sub- Fund
High Volatility Min 65% Min 20% Nil
Medium Volatility Min 35% Min 40% Min 10%
Low Volatility Min 10% Min 60% Min 15%
Lower Volatility Nil Min 40% Min 40%
Customized Allocation Scheme 0-100% 0-100% 0-100%
Investment Strategy The Pension Fund Manager shall design investment strategy to optimize returns on investments within the parameters of Investment Policy specified by the Commission. The Pension Fund Manager shall also offer different Allocation Schemes to Participants to choose from, allowing them to adopt an investment strategy, according to their risk / return requirements
Reallocation Policy Units held in the Individual Pension Account shall be reallocated by the Pension Fund Manager between the Sub-Funds at least once a year to ensure that the allocation of Units of all Participants is in line with the Allocation Scheme selected by them.
Wakalah tul Istismar / Wakalah Fee The amount charged by Fund Manager as Wakeel from the fund in form of Front End Fee & Management Fee.
Front-end Fee Maximum of 3 % on all Contributions as part of Wakalah Fee, unless exempt under this Offering Document
Management Fee 1.5 % p.a. on average Net Assets of each Sub-Fund as part of Wakalah Fee.
Taxation Tax Credit will be available to Participants on contributions during any Tax Year subject to the limits prescribed under the Income Tax Ordinance, 2001 (XLIX OF 2001)
Benefits / Withdrawal on Retirement All Units of each Sub-Fund held by a Participant in his Individual Pension Account shall be redeemed at the Net Asset Value notified at close of the day of retirement or, if that day is not a Business Day, the following Business Day. The Participant will then have the following options, namely:
(a) to en-cash up to fifty percent (50%) or any percent as admissible under the Income Tax Ordinance, 2001, of the amount in his Individual Pension Account, without any Tax deductions. Tax will be deducted at a rate of the average tax percentage of the Participant for the previous 3 years, if the Participant withdraws any amount over the limit admissible under the Income Tax Ordinance 2001; and
(b) either to use the remaining amount to purchase an annuity from a Life Takaful Company of his/her choice; or
(c) enter into an agreement with the Pension Fund Manager to transfer his balance to an Approved Income Payment Plan offered by the Pension Fund Manager or another Pension Fund Manager and withdraw from it monthly installments for up to 15 years following the date of retirement, according to the Approved Income Payment Plan.
Early Withdrawal / Withdrawal before Retirement Participants at any time before retirement are entitled to redeem the whole or any part of the Units held to their credit in their Individual Pension Account. Tax may be applicable in accordance with the requirements of the Income Tax Ordinance, 2001 and, if applicable, will be deducted by the Pension Fund Manager from the amount withdrawn
Transfers to and from other Pension Funds Participants shall be entitled to transfer part or whole of their Individual Pension Accounts from this Pension Fund to another once a Financial year with 21 days’ notice. There shall be no Tax or charges on such transfers. Similarly Participants are allowed to transfer-in their funds from other Pension Funds and approved Occupational Savings Schemes or approved superannuation funds to this Islamic Pension Fund without having to pay any Front End Fee to the Pension Fund Manager
Transparency Daily calculation and announcement of NAV of each Sub –fund
Distribution Restriction Any income earned shall be retained and accumulated in the respective sub-funds and no distribution / Dividend shall be made from the Islamic Pension Fund.


Shariah Advisors
i.The Pension Fund Manager has appointed Mufti Zeeshan Abdul Aziz as Shariah Advisor to the Islamic Pension Fund.
ii. All activities of the Islamic Pension Fund shall be undertaken in accordance with the Islamic Shariah as per the guidelines given by the Shariah Advisor

Withholding Tax

The Trustee on the advice of the Pension Fund Manager shall with hold any tax or tax penalty from payments to the Participants or,inaccordance with the Trust Deed and the Offering Document, to their nominated survivors, executors, administrators or successors,as the case may be,applicable under the Income Tax Ordinance,2001 (Ordinance No.XLIX of 2001) andshall deposit the same in the Government treasury.

Retirement Age

The Participant may choose his/her Retirement Age which would be between sixty and seventy years or twenty-five years since the age of first contribution to a islamic pension fund whichever is earlier. Participant shall send a notice to the Pension Fund Manager at least thirty days before the chosen date of Retirement. If a Participant suffers from any of the following disabilities, which render him unable to generate any income he/she may, if he/she so elects, be treated as having reached the Retirement Age at the date of such disability and all relevant provisions shall apply accordingly, namely:

a. loss of two or more limbs or loss of a hand and a foot;
b. loss of eyesight;
c. deafness in both ears;
d. severe facial disfigurement;
e. loss of speech;
f. paraplegia or hemiplegia;
g. lunacy;
h. advance case of incurable disease; or
i. wounds, injuries or any other diseases etc., resulting in a disability due to which the Participant is unable to continue any work.

An assessment certificate from the medical board approved by the Commission and appointed by the Pension Fund Manager or any such procedure that the Commission has approved would be required to confirm any of the disability, specified above.

Investment Policy

The NIT Islamic Pension Fund through its three Sub-Funds, NIT-IPF Equity Sub-Fund, NIT-IPF Debt Sub-Fund and NIT-IPF Money Market Sub-Fund, under its umbrella, will invest in equities, bonds and money market instruments. (Further details as per offering document).

Risk Disclosure

Investors must realize that all investments in mutual funds and securities are subject to market risks. Our target return / dividend range cannot be guaranteed and it should be clearly understood that the portfolio of NIT Islamic Pension Fund is subject to market price fluctuations and other risks inherent in all such investments.


The Units of the Sub-Funds of the Islamic Pension Fund are not bank deposits and are neither issued by, insured by, obligations of, nor otherwise supported by the Commission, the Stock Exchanges, any government agency, the Trustee or any of the sponsors, shareholders or employees of the Pension Fund Manager or any of the investors of the Seed Capital Units or any other Bank or financial institution.


a.Tax Credit for Contributions to the Islamic Pension Fund
An eligible person,as defined in sub-section(19A) of section 2 of the Income Tax Ordinance, 2001, deriving income chargeable to tax under the head “Salary” or the head “Income from Business”, will be entitled to a Tax Credit for a Tax Year in respect of any contribution or premium paid in the year by the person to the Islamic Pension Fund under the VPS Rules, 2005.

The amount of a person’s Tax Credit allowed under Sub-section(1)for a Tax Year shall be computed according to thefollowing formula, namely:– 
                                                    (A/B) x C

A is the amount of tax assessed to the person for the Tax Year,before allowance of any Tax Credit under this Part;
B is the person’s taxable income for the tax year; and
C is the lesser of –

(i)the total contribution or premium referred to in sub-section(1) paid by the person in the year; or

(ii)twenty percent(20%)of the person’s taxable income for the relevant Tax Year Provided that a person joining the Pension Fund at the age of forty-one (41) years or above, during the first ten (10)years starting from July 1, 2006, shall be allowed additional contribution of two percent(2%)per annum for each year of age exceeding forty years. Provided, further, that the total contribution allowed to such person shall not exceed fifty percent(50%) of the total taxable income of the preceding year;

b. Tax Exemptions

Exemptions under Clause (57) sub Clause (3) (viii) of Part-I of the Second Schedule of the Income Tax Ordinance, 2001:

(a) Total income of the Pension Fund approved by the SECP under the VPS Rules, 2005.
(b) Profit or gain or benefit derived by the Pension Fund Manager from a pension fund approved under the VPS Rules, 2005 on redemption of the seed capital invested in the Islamic Pension Fund.

c. Withholding Tax
A pension fund manager making payment from individual pension accounts, maintained under an approved pension fund, shall deduct tax from any amount:

a. Withdrawn before the age of retirement, provided that tax shall not be withheld in the following cases

  • eligible person suffering from any disability which render him unable to continue with any employment at the age which he may so elect to be treated as retirement age or the age as on the date of such disability if not so elected by him; or
  • on the share of the nominated survivor of the deceased eligible person.

b. Withdrawn, if in excess of fifty per cent of his accumulated balance at or after the retirement age, provided tax shall not be withheld in the following cases

  • the balance is invested in an approved income payment plan;
  • the balance is paid to a takaful company for the purchase of an annuity plan;
  • the balance is transferred to an another individual pension account of the eligible person;or
  • the balance is transferred to the survivors approved pension account in case of the death of the eligible person.

The tax is required to be withheld at the last three year’s average rate of tax which shall be computed in accordance with the following formula:
        A= the total tax paid or payable by the person on the person’s total taxable income for the three preceding years; and
        B= the person’s total taxable income for the preceding three years.

d. Zakat
Units held by resident Pakistani Participants shall be subject to Zakat at two and a half percent (2.5%) on lower of the par value of Units and Redemption price under Zakat and Ushr Ordinance,1980,(XVIIof1980), except those exempted under the said Ordinance. Zakat will be deducted at source from redemption / withdrawal payment, and paid into the Government Treasury.


The tax and Zakat information given above is based on the Pension Fund Manager’s interpretation of the law which, to the best of the Pension Fund Manager’s understanding, is correct but Participants are requested to seek independent advice from their tax advisors so as to determine the taxability arising from their Contributions to the Islamic Pension Fund.