Choosing a structure before company registration in Karachi
Single-member company
A private company with one member — suited to a solo founder who wants limited liability.
Private limited company
Two or more members; the usual choice for co-founders and for raising investment.
Limited liability partnership
Under the LLP Act 2017 — partnership flexibility with limited liability.
Partnership firm
Registered with the Registrar of Firms under the Partnership Act 1932; partners' liability is not limited.
Sole proprietorship
No incorporation; the owner registers for tax. Simple but no liability protection.
Public company
For larger ventures; more onerous governance and filing requirements.
Steps of company registration in Karachi
- Name search and reservation on the SECP's online system, avoiding names that are identical to existing companies or registered trade marks.
- Drafting the memorandum and articles of association, including objects, share capital and governance rules.
- Collecting the details and CNICs (or passports) of subscribers and directors, and the registered office address in Karachi.
- Online incorporation filing with the SECP and payment of the prescribed fee.
- Issue of the certificate of incorporation and the company's registration number.
- Post-incorporation steps listed below.
After company registration in Karachi
Tax registration
Register the company on the FBR's IRIS portal for an NTN, and file returns annually. See income tax return filing in Karachi.
Sindh Revenue Board
If the company provides taxable services in Sindh, register with the SRB for sales tax on services.
Bank account
Banks will ask for the incorporation documents, board resolution and beneficial-ownership information.
Statutory registers and filings
Maintain registers of members and directors, file the annual return and financial statements with the SECP, and report changes such as new directors or share transfers within the time allowed.
Founders' agreements and share structure
Many startup disputes come from what was never written down. A shareholders' agreement should deal with vesting of founder shares, decision-making, what happens if a founder leaves, and how new investors come in. We draft these alongside the incorporation so that the articles and the agreement do not contradict each other.
Protecting the brand
Incorporation does not give exclusive rights to the brand name. Register the trade mark separately with the Intellectual Property Organisation — see trademark registration in Pakistan. Software and creative content can be protected by copyright registration.
Company registration in Karachi for foreign founders
Foreign nationals can be shareholders and directors, subject to security clearance procedures for foreign directors and subscribers, and to sector-specific rules. Foreign investment should be brought in through proper banking channels so that it is documented for later repatriation of profits.
Company registration in Karachi: costs to plan for
The cost of incorporation depends mainly on the authorised capital and the SECP's fee schedule at the time of filing, plus professional fees for drafting and filing. Beyond incorporation, budget for annual filings, an accountant or auditor where required, tax compliance and, for service businesses, Sindh Revenue Board registration. We give a written estimate once we know the structure.
Ongoing compliance after company registration in Karachi
Annual return
Filed with the SECP each year with member and director details.
Financial statements
Prepared and, where required, audited, then filed.
Income tax return
Filed annually with the FBR; see return filing.
Withholding statements
Periodic statements where the company deducts tax at source.
SRB returns
Monthly sales tax returns for registered service providers.
Changes
Report new directors, share transfers and office changes in time.
Single-member company or private limited: how to decide
Choose a single-member company if
- You are the only founder.
- You want limited liability without a partner.
- You can nominate a person to take over if you die or become incapacitated, as the law requires for an SMC.
Choose a private limited company if
- There are two or more founders.
- You plan to issue shares to investors or employees.
- You need a board structure from the start.
Common mistakes in company registration in Karachi
- Choosing a name that conflicts with a registered trade mark.
- Using standard articles that do not match the founders' agreement.
- Allotting shares without documenting payment.
- Forgetting post-incorporation tax and SRB registration.
- Missing the first annual filings, leading to penalties.
To begin incorporation, send the proposed names and founders' details on WhatsApp to +92 333 1127830.
Private limited, SMC, LLP and partnership compared
Founders choosing a structure can use this summary before incorporation.
| Structure | Members | Liability | Registered with |
|---|---|---|---|
| Single-member company | One | Limited | SECP |
| Private limited company | Two or more | Limited | SECP |
| Limited liability partnership | Two or more partners | Limited | SECP |
| Partnership firm | Two or more | Unlimited | Registrar of Firms |
| Sole proprietorship | One | Unlimited | Not incorporated; tax registration only |
Raising investment after incorporation
When an investor comes in, the company issues new shares or a founder transfers existing ones. Each step needs board and shareholder approvals as the articles require, filings with the SECP within the prescribed time, and documented receipt of the money through banking channels. Investors usually ask for a shareholders' agreement with rights on information, board seats and future share issues.
Employee share options, convertible notes and similar instruments need careful drafting to fit the Companies Act 2017.
Closing or striking off a company
A company that no longer trades should not simply be abandoned, because filings and penalties continue to accrue. The Companies Act 2017 provides routes for winding up and for striking off defunct companies. We advise on the cleanest route for your situation.
Choosing directors and a company secretary
Directors owe duties to the company and can face personal consequences for defaults in filings and tax. Appoint directors who will engage with the business. Larger companies need a company secretary; for small private companies, the responsibility for filings still rests with the directors.
Incorporation: a founder's checklist
- Agree the structure and the share split among founders.
- Choose two or three possible names and check them against registered trade marks.
- Decide the registered office address.
- Collect CNICs or passports of subscribers and directors.
- Agree the objects and any special provisions for the articles.
- Plan bank, tax and SRB registration for after incorporation.
With this list ready, incorporation usually proceeds smoothly, and we can move straight to drafting and filing.
Beneficial ownership and record keeping
Companies must keep a register of their ultimate beneficial owners and report the information to the SECP as the law requires. Banks also ask for it when opening accounts. Keep the register up to date whenever shares change hands, because inaccurate records cause problems at the bank and with the regulator.
Working with foreign investors
Where a foreign investor takes shares, the investment should come through banking channels and be properly documented so that dividends and capital can later be repatriated. Some sectors have additional approval requirements. We plan these steps alongside incorporation so that the investment is recorded correctly from the start.
Licences and sector approvals
Some businesses need sector licences in addition to incorporation — for example, food businesses, education providers, financial services and import-export operations. These come from different regulators and may have their own conditions. We identify these needs early so that incorporation does not leave the business unable to trade.
Business disputes and contracts
For commercial disputes, recovery of dues and contract enforcement, see our civil lawyers. For employment issues, see labour lawyers in Karachi.
Frequently asked questions
How many people are needed to register a company?
A single-member company needs one; an ordinary private limited company needs at least two members.
Can I use my home address in Karachi as the registered office?
A registered office address is required; a residential address may be used subject to any lease or society restrictions.
How long does incorporation take?
It depends on name approval and the completeness of documents. We estimate once documents are ready.
Does registration protect my brand name?
No. Register a trade mark separately with IPO-Pakistan.
Who handles corporate work at your firm?
Mohsin Ali Shah, consulting lawyer for corporate and tax matters.
Do I need an office to register a company in Karachi?
You need a registered office address where official communications can be received.
Can I convert my sole proprietorship into a company?
Yes. The business assets and contracts are transferred to the new company; tax and contract consequences should be reviewed first.
Can a foreigner be a director of a Pakistani company?
Yes, subject to the security clearance process that applies to foreign directors and subscribers.
What happens if annual filings are missed?
The company and its officers may face penalties, and persistent default can lead to further action by the SECP.
Can a company be converted from SMC to private limited?
Yes, by following the SECP procedure for conversion when more members join.
Speak to Karachi Lawyers about Company Registration in Karachi
Karachi Lawyers has practised since 1985 and has about 17 advocates, including two Advocates Supreme Court. Send a WhatsApp message to +92 333 1127830 with your name, a two-line summary of the matter, any deadline or hearing date, and photos of the key documents. We will tell you what the law requires, which documents are missing and what the next step is, and fix an appointment at our Gulistan-e-Jauhar office (Mezzanine Floor, Muneer Mobile Mall, Block 17) or our DHA office (Mezzanine Floor, Main Jami Commercial, Phase 7). We explain the scope of work before you instruct us, and we never promise an outcome we cannot control.
Related services from Karachi Lawyers
Official sources
For reference only. Procedures and charges change; confirm the current position for your own case.
This page gives general information about the law in Pakistan and is not legal advice for your particular case. No outcome, timeline or fee can be guaranteed before your documents and circumstances have been reviewed.
Reviewed by: Mohsin Ali Shah, Consulting Lawyer (M.A., LL.B.)
Published by: Karachi Lawyers
Last updated: