Founders are quoted a single number for company formation and cannot tell what is a government fee, what is professional charge and what is avoidable. The SECP element is published and predictable once you understand what drives it. Almost everything else in a formation quote is either a different authority's fee or someone's time.
What drives the SECP fee
| Driver | Effect |
|---|---|
| Authorised share capital | The main driver - higher capital, higher fee |
| Company type | SMC, private, public and non-profit differ |
| Filing method | Online through eServices is generally cheaper than physical |
| Name reservation | Charged separately from incorporation |
| Later filings | Each change of name, capital, directors or office has its own fee |
Authorised capital is the lever founders most often get wrong. It is the ceiling of shares the company may issue, not what you must pay in. Setting it unnecessarily high raises the incorporation fee immediately; setting it too low means paying again later to increase it. Choose a figure with sensible headroom for the next few years.
Costs that are not SECP fees
A formation quote usually bundles several unrelated items. Separate them:
- Digital signature costs for subscribers filing online.
- Stamp duty on the memorandum and articles, which is a provincial charge, not SECP.
- FBR registration, which is free for an individual and follows incorporation for the company.
- Bank account opening charges and minimum balance requirements.
- Company seal and stationery.
- Registered office documentation - tenancy agreement, potentially with its own stamp duty.
- Professional fees for whoever prepares and files.
- Sector licences where the business is regulated.
Ask any quote to be itemised into SECP fees, other government charges and professional fees. A quote that cannot be broken down that way is not one you can compare.
Fees do not stop at incorporation
Formation is a one-off; compliance is not. Budget for:
- Annual return filing to SECP.
- Financial statements filing where required for the company type.
- Filings on change - directors, registered office, capital, name.
- Late filing penalties if deadlines are missed, which accumulate quietly.
- FBR annual return and monthly sales tax returns where registered.
- Professional fees for preparing all of the above.
Dormant companies still incur these obligations. Founders who incorporate for a project that does not proceed frequently ignore the company entirely and return years later to find accumulated default. If a company will not be used, deal with it properly rather than abandoning it.
Reducing the cost legitimately
- Set authorised capital sensibly - enough headroom, no more.
- File online through eServices rather than physically.
- Choose the right company type. An SMC suits a sole founder; a public company carries far heavier compliance.
- Clear the name properly first, so you do not pay for a second reservation.
- Get the documents right first time, avoiding resubmission.
- Bundle changes where several filings are needed.
- Diarise compliance deadlines to avoid late fees, which are pure waste.
Comparing formation quotes
| Ask | Why it matters |
|---|---|
| What SECP fee is included, at what authorised capital? | The main variable in the government charge |
| Is stamp duty included, and at which province's rate? | Provincial charge, often omitted from quotes |
| Are digital signatures included? | Per-subscriber cost |
| Is FBR registration included? | Follows incorporation |
| Is the first annual filing included? | Frequently excluded, then charged |
| What happens if the name is rejected? | Who pays for the second attempt |
See our full breakdown of the total cost of starting a company, which covers the non-SECP elements in detail.
Always verify the current schedule
This deserves stating plainly: any article quoting specific SECP amounts, including this one, ages badly. Fee schedules are revised, and both the amounts and the capital bands can move.
- Take the current schedule from secp.gov.pk before budgeting.
- Check the fee calculator on eServices where available.
- Confirm the online versus physical differential, which changes.
- Confirm stamp duty with the province where the company is registered.
If a consultant quotes you a "SECP fee" without reference to your authorised capital, they are either estimating or including their own charge in the figure. The SECP element cannot be stated without knowing the capital, because that is what drives it.
Choosing authorised capital sensibly
Because authorised capital drives the fee, it deserves a deliberate decision rather than a default.
What it is: the maximum share capital the company may issue. It is not money you must deposit, and it is not a measure of the company's worth.
How to pick a figure:
- Start from paid-up capital - what the founders will actually subscribe.
- Add headroom for issuance over the next few years, including any planned investment round.
- Check whether any licence or tender in your sector requires a minimum capital.
- Stop there. Capital you will never issue is fee you pay for nothing.
If you get it wrong: increasing authorised capital later is a separate filing with its own fee and a members' resolution. It is not difficult, but it is avoidable friction and cost.
Founders sometimes set a very high authorised capital believing it signals substance to customers or investors. It does not - anyone assessing the company looks at paid-up capital and accounts. All it does is increase the incorporation fee.
Frequently asked questions
How is the SECP registration fee calculated?
Mainly by authorised share capital and company type, with separate charges for name reservation, incorporation and later filings. Online filing through eServices is generally cheaper than physical filing.
What is authorised share capital and how does it affect the fee?
It is the ceiling of shares the company may issue, not what you must pay in. Setting it unnecessarily high raises the incorporation fee immediately; setting it too low means paying again later to increase it.
What costs are not SECP fees?
Stamp duty on the memorandum and articles, which is provincial; digital signature costs; bank account opening; company seal and stationery; registered office documentation; sector licences; and professional fees.
Are there ongoing SECP fees after incorporation?
Yes. Annual return filing, financial statements where required, filings on any change of directors, office, capital or name, and late filing penalties if deadlines are missed.
How can I reduce the SECP cost legitimately?
Set authorised capital sensibly, file online rather than physically, choose the right company type, clear the name properly to avoid a second reservation, and get documents right first time to avoid resubmission.
Why do formation quotes vary so much?
Because they bundle SECP fees, provincial stamp duty, digital signatures, FBR registration and professional time into one figure. Ask for it itemised into government charges and professional fees.
Do I have to deposit the authorised capital in the bank?
No. Authorised capital is the ceiling of shares the company may issue, not money you must deposit. What subscribers actually pay in is the paid-up capital, which is a separate and usually much smaller figure.
Can I increase authorised capital later?
Yes, through a members' resolution and a separate SECP filing with its own fee. It is straightforward but avoidable friction, which is why sensible headroom at incorporation is worth thinking about.
Is online filing really cheaper than physical filing?
Generally yes, and the differential is set out in the SECP schedule. Confirm the current position on secp.gov.pk, as both the fees and the differential are revised periodically.
Does SECP charge a fee for the annual return?
Filing fees apply to statutory filings including the annual return, and late filing attracts additional charges that accumulate. Budget for the annual compliance cycle from the first year.
Are fees different for a single member company?
Company type is one of the drivers in the schedule alongside authorised capital, so an SMC, a private company and a public company are not charged identically. Check the current schedule against your intended type.
Sources & official references
- Securities and Exchange Commission of Pakistan - fee schedule, forms and the company register
- SECP eServices portal - online filings and name reservation
- Companies Act 2017 - the governing statute on the official Pakistan Code