To calculate WPPF, take 5% of the company's net profit. 80% of that goes to the Participation Fund, 10% to the Welfare Fund and 10% to the Workers' Welfare Foundation Fund. Two-thirds of the Participation Fund is usually paid in cash to all beneficiaries in equal shares. Try your own figures in the calculator below.
Example: a company's net profit before WPPF is BDT 2.5 crore. Using the first method, total WPPF is BDT 12.5 lakh. 80% (BDT 10 lakh) goes to the Participation Fund and BDT 1.25 lakh to each of the other two funds. With 180 beneficiaries, two-thirds of the Participation Fund (about BDT 6.67 lakh) shared equally gives each about BDT 3,704 in cash.
The two methods
The second method treats WPPF itself as an expense, so it is 5% of profit after deducting WPPF. Both are in use. Keep whichever method your company has used before, for consistency, and agree it with your auditor.
| Method | Formula | On BDT 2.5 crore profit |
|---|---|---|
| 5% of profit before charging WPPF | Profit × 5% | 1,250,000 |
| 5% of profit after charging WPPF | Profit × 5 ÷ 105 | 1,190,476 |
What the calculator does not check
- Whether WPPF applies to your company at all; that depends on the Labour Act's capital and asset thresholds
- The number of beneficiaries; who is eligible depends on the legal definition and length of service
- Changes to the split from future amendments; check the latest law
Frequently asked questions
Which net profit should I use?
Profit before income tax in the income statement, before charging WPPF as an expense. Practice can vary slightly with company policy and the auditor's view.
What happens to the remaining third of the Participation Fund?
It is usually invested, and the income from it also belongs to the beneficiaries. Detailed rules are in the law and the fund board's decisions.
Are my figures stored?
No. Everything is calculated in your browser; nothing is sent to us.
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Written by the EOMS Hisab accounts team. Last reviewed: . Bangladesh rules change with each Finance Act, SRO and circular. Check rates and thresholds against the latest official source before relying on them.