Company Incorporation and Business Registratioin Guidance for Foreign Investors & Businesses

Expanding into a new market like Pakistan requires a thorough understanding of the legal framework, taxation policies, investment regulations, and operational requirements. At Usman Rasheed & Co. Chartered Accountants (URCA), we provide full-spectrum business setup solutions that help foreign investors enter the Pakistani market with ease, efficiency, and full legal compliance.

💡 Our Business Setup Services Cover:

✅ Company Incorporation & SECP Registration

✅ FBR Tax Registration (NTN, STRN, WHT, and more)

✅ Licensing & Industry-Specific Approvals

✅ Corporate Banking & Financial Compliance

✅ Work Visas & Foreign Direct Investment (FDI) Approvals

📌 Need assistance in setting up your business? Schedule a Free Consultation

Types of Business Entities in Pakistan

Choosing the right business entity is critical for foreign investors, as it impacts ownership rights, liability, taxation, and regulatory compliance. Below are the main legal structures available for businesses in Pakistan.

🏢 1. Private Limited Company (Pvt. Ltd.) – The Most Preferred Option

A Private Limited Company (Pvt. Ltd.) is the most commonly chosen business structure in Pakistan, offering limited liability protection, operational flexibility, and 100% foreign ownership eligibility.

📌 Key Features & Advantages:

✅ Separate Legal Entity – The company operates independently from its owners.

✅ Limited Liability Protection – Shareholders’ personal assets are protected.

✅ 100% Foreign Ownership – No local partner required.

✅ Minimum Two Shareholders – A director can also be a shareholder.

✅ Company Bank Account Required – For financial transactions.

✅ Annual Financial Statements & SECP Compliance Mandatory.

📌 Best for: Foreign investors, medium to large businesses, technology firms, import/export companies, and professional service providers.

💡 Looking to register a Pvt. Ltd. company? Let Our Experts Handle It

🌍 2. Branch Office (BO) – For International Companies Expanding to Pakistan

A Branch Office (BO) is an extension of a foreign company, allowing it to conduct business activities in Pakistan without forming a separate legal entity. However, BOs require Board of Investment (BOI) approval.

📌 Key Features & Compliance Requirements:

✅ Not a Separate Legal Entity – Operates under the parent company’s control.

✅ Can Conduct Commercial Activities – Subject to BOI approval.

✅ Profit Repatriation Allowed – Subject to State Bank of Pakistan (SBP) regulations.

✅ Must Renew Approval Every 1-5 Years.

✅ Requires Local Office & Bank Account.

📌 Best for: Foreign corporations expanding into Pakistan, multinational service providers, and trading companies.

🔍 3. Liaison Office (LO) – For Market Research & Business Representation

A Liaison Office (LO) is ideal for foreign companies that want a business presence in Pakistan without engaging in commercial activities. It allows businesses to study the market, connect with local partners, and promote their brand.

📌 Key Features:

✅ No Revenue Generation Allowed – Can only perform non-commercial activities.

✅ BOI Approval Required – Valid for 1-5 years.

✅ Can Conduct Market Research & Promotional Activities.

✅ No Taxation or Local Invoicing Since there is no commercial activity.

✅ Not Subject to Local Corporate Laws.

📌 Best for: Foreign companies exploring business opportunities before full-scale entry.

👤 4. Sole Proprietorship – For Individual Entrepreneurs & Freelancers

A Sole Proprietorship is the simplest form of business structure where an individual operates a business under their own name or a registered business name. However, the owner is personally liable for all debts and legal obligations.

📌 Key Features:

✅ Quick & Easy Registration with FBR (NTN & STRN).

✅ No SECP Compliance Required.

✅ Personal Liability for Business Debts.

✅ Taxed Under Personal Income Tax Slabs.

📌 Best for: Freelancers, small traders, consultants, and self-employed professionals.

🤝 5. Partnership Firm – Ideal for Small & Medium-Sized Businesses

A Partnership Firm is formed when two or more individuals start a business together. It requires a Partnership Deed, outlining the roles, responsibilities, and profit-sharing ratios.

📌 Key Features:

✅ Flexible Business Structure with shared ownership.

✅ Liability is Shared – Partners are personally responsible for business debts.

✅ Registered Under Partnership Act, 1932.

✅ Taxed at Individual Partner’s Income Tax Rate.

📌 Best for: Professional service firms, law firms, small trading businesses, and local joint ventures.

Step-by-Step Business Registration Process in Pakistan

Setting up a business in Pakistan involves multiple legal steps, but our expert team ensures a smooth and fast-tracked process.

1️⃣ Name Reservation & Company Incorporation

✅ Choose a unique business name and get approval from SECP.

✅ Prepare & submit following documents and information.

• • Principal Line of Business
  • A correspondence address in Pakistan.
  • Name of shareholder(s), Director(s) and Chief Executive along with their copies of passport in case of a foreigner or CNIC in case of Pakistani
  • Detail of shares to be subscribed by each shareholder
  • Undertaking by the foreign shareholders and directors on the prescribed format.In case foreign director(s) or shareholder(s) are in Pakistan, copy of valid visa and in if they are not in Pakistan, the undertaking must be notarized and attested by Pakistani High Commission in the foreign country

✅ Obtain Certificate of Incorporation (5-7 days processing time).

2️⃣ Tax Registration (NTN, STRN, WHT Compliance)

✅ Register with FBR for National Tax Number (NTN).

✅ Apply for Sales Tax Registration Number (STRN) if required.

✅ Ensure compliance with Withholding Tax (WHT) regulations.

3️⃣ Corporate Bank Account Setup

✅ Select a local or international bank operating in Pakistan.

✅ Submit incorporation & tax documents.

4️⃣ Licensing & Industry-Specific Approvals

✅ Apply for sector-specific licenses (e.g., PTA, PEC, Drug Regulatory Authority, etc.).

✅ Register with EOBI & Social Security if hiring employees.

📌 Need help with the entire process? Book a Consultation

Why Choose URCA for Business Setup in Pakistan?

🔹 Expert Guidance – Helping global clients enter Pakistan successfully.
🔹 End-to-End Support – From incorporation to tax compliance.
🔹 Speed & Efficiency – Business registration completed in 7-10 days.
🔹 100% Compliance – Ensuring legal & tax obligations are met.