No.ProcedureTime to CompleteAssociated Costs1Obtain approval of company name through the Securities and Exchange Commission of Pakistan (SECP) E-service website
The company proposes one or more names in order of preference and submit these for approval via e-service or in person to the Securities and Exchange Commission of Pakistan (SECP). The availability of suggested names can be firstly checked online by searching existing company name. Online submission is cheaper than manual submission of the application. E-Services by SECP has enabled the promoters of a company to seek company name availability online, using the eServices Portal, without visiting the Company Registration Office (CRO). Application fee for the availability of name through the on-linesystem is Rs. 200/- whereas would be Rs.500/- if done in person and not online. For this purpose, an applicant has to follow certain steps in order to reserve a desired name for the proposed company. The official confirmation (or denial) of the chosen name and its availability is received by email or via courier upon payment of the name reservation fee of PKR 200 (online name reservation) or PKR 500 (offline name reservation) at the bank designated by SECP. The approved name is reserved for 90 days by which time the company needs to get it self incorporated. The use of online submission is growing but in some cities a big majority of entrepreneurs still prefer to apply in person.
1 day PKR 200 (E-services online name reservation fee PKR 200)2Pay the fees for name registration and company incorporation using bank challans at the designated bank (MCB)
The company has to pay the fees for name search availability and incorporation. The amount are required to be deposited with the Muslim Commercial Bank Ltd. They can be downloaded from the SECP website and offices or at the bank.
1 day inlcuded in procedure 2 (name verification fees) and procedure 3 (registration fees)3Register the company with the Securities & Exchange Commission of Pakitan (SECP) through online E-services
The company can complete the registration online through the e-Services or in person at the SECP. The following documents are required for the incorporation of a private company:
a. Form 1: Declaration of compliance;
b. Form 21: Identification of the location of the office;
c. Form 29: Particulars of directors, secretary, chief accountant, auditors, and others.
d. One copy of the Memorandum and Articles of Associations with the signature of each member (in presence of a witness).
According to the 6th Schedule of Fee effective from June 2009, the fees for incorporation of a company with an authorized capital up to PKR 800,000 are the following:
1. Online submission: registration fee PKR 6,000 and filing fee PKR 2,400;
2. Physical (off-line) submission: registration fee PKR 12,000 and filing fee PKR 4,500;
A confirmation of the online/ in person submission is received instantly and the actual certificate a few days later via email and courier. The company can register with any Company Registration Office, irrespective of the jurisdiction. All regional SECP offices are computerized.
2 days PKR 6000 registration fee + PKR 2400 filing fee ( Form 1, Form 21 & form 29 & copy of memorandum of association)4Obtain digital signatures from the National Institutional Facilitation Technologies (NIFT) through the SECP e-services
The digital signature is obtained from the National Institutional Facilitation Technologies (NIFT) through e-Services or at the SECP offices. NIFT serves as the witness of all digitally signed documentation. To apply, the company has to submit the Digital Signature Certificate Request Form along with scanned copies of the Directors’ identity cards, Name Availability Certificate and a proof of payment.
1 day PKR 650 (certificate charges) + PKR 126.75 (federal excise duty at 19.5%) + PKR 500 (validation charges)5Apply for a national tax number (NTN) and register for income tax
According to the Income Tax Ordinance 2001, every company must register for income tax and obtain the national tax number (NTN) that is generally required by other registering authorities like Chambers of Commerce, Import-Export Regulatory Authority, utility authorities, etc. The income tax is paid on filing the return, which is due in 6 months from the end of the company’s financial year (usually on June 30). Since 2002, after the introduction of the Income Tax Ordinance 2001, NTN is issued with a continuous valid term (without the need to renew the number).
To apply, the company has to submit a simple one page form called the NTN Form as well as a proof of registration, the Memorandum and Articles of Association, bank account number, copies of the national identity cards of its directors and an attestation of the registered business address at the nearest tax facilitation counter of the Regional Tax Office in Pakistan.
All applications are forwarded to the Central Registration Office (CRO) in Islamabad that allots a uniform NTN number to each company. The center processes the application and issues the NTN at no cost. The certificate is sent to the registered address of the applicant. The company can track the application online or through the RTO helpline. If undelivered, the NTN certification can be collected from the specified office at the Central Board of Revenue.
2 days no charge6Register for sales tax by applying for a Sales Tax Number (STN) at the tax facilitation center of the Regional Tax Office (RTO) of the Federal Board of Revenue (FBR) in Karachi
According to the Sections 14, 15 and 16 of the Sales Tax Act 1990 and Sales Tax Rules 2006, the company has to register for sales tax by submitting the application on Form STR-1 at any tax facilitation counter at the nearest Regional Tax Office (RTO). The local RTO forwards all application to the Central Registration Office. After verification, the CRO issues a Registration Certificate bearing the registration number and mails the same to the registered company, on a prescribed From STR-5.
The Sales Tax General Order No. 4/2007 introduced electronic filing of the sales tax returns and from July 1st 2008, electronic filing was made mandatory for all categories of taxpayers.
1 day no charge* 7Register for Professional Tax with the Excise & Taxation Department of the District
Following the Devolution Plan 2001, professional tax is enforced at the district level by the Excise and Taxation Department of the relevant provincial district. According to the Punjab Finance Act 1977, the tax is levied upon businesses, professionals, trades, callings or companies employing such professionals. The responsible district Excise and Taxation Officer (ET officer) is empowered to enroll in survey register every person who carries on any such business or profession and thereafter, give notice to such enrolled person. In case of a new business, the company is required to make a request to the ET officer to get enrolled by submitting a simple assessment form. The ET officer issues a registration number that acts as the reference number for the registered company and is noted down on every Bank Challan when assessments are paid into the Bank.
7 days (simultaneous with the previous procedure) no charge* 8Register with the Sind Employees Social Security Institution (SESSI)
According to the Punjab Industrial Policy 2003, registration with the Employees Social Security Institution is governed at the provincial level by an independent self-generating institution called the Punjab ESSI. Employers covered under the scheme contribute 6% of the wages to insurable workers. The wage ceiling should not exceed PKR 10,000 per month or PKR 400 per day. The registration is compulsory. The company has to fill up a simple form to be allotted a registration number and to receive later an employee card.
11 days (simultaneous with the previous procedure) no charge* 9Register with Employees Old-Age Benefits Institution (EOBI).
According to the Amendment in EOBI Act 1976, with the effect from July 2008, every industry or a commercial establishment with 5 or more employees has to be registered with the federal Employees Old Age Benefits Institution. Under the Employees Old Age Benefit Scheme, insured persons are entitled to pension (when retiring), invalidity (when permanently disabled) and old-age grant (an insured person retiring that does not possess the minimum threshold for pension) and survivor’s pension. A contribution equal to 5% of minimum wages has to be paid by the Employers and 1% of the wage is paid by the Employee.
For initial registration, the company has to fill out and submit a simple form that is uploaded into the database. The allotment requests are sent to a center in Karachi that issues the registration numbers along with certificates and cards and sends them to the company. Computerization of records is underway.
11 days (simultaneous with the previous procedure) no charge* 10Register under the West Pakistan Shops and Establishment Ordinance 1969 with the Labour Department of the District
Pakistan Shops and Establishment Ordinance 1969 requires every establishment other than a one man shop to be registered with the Deputy Chief Inspector of the Labor Department in each district. This is to safeguard the labor standards of the workers.
To register, the employer has to submit application in Form A accompanied by a bank challan. The application for a new establishment shall be made within 2 months of setting up the establishment. The fees for registration are the following: 1-5 workers: PKR 2; 6-10 workers: PKR 3; 11-20 workers: PKR5; more than 20 workers: PKR 10. Once the fee was paid, the Deputy Chief Inspection registers the establishment in the Register of Establishments maintained in Form B and issues a registration certificate in Form C. The certificate has to be prominently displayed by the employer at the establishment.
7 days (simultaneous with the previous procedure) PKR 10