A great product can still be sunk by a weak legal foundation - a co-founder falling out with no agreement, a brand name someone else registers first, or a tax notice in month three. The good news is that getting a startup legally ready in Pakistan is now largely an online process. This guide gives you a clear, ordered checklist covering everything from picking a structure to your first compliance filings, with the governing law noted at each step. When you want it done properly, our corporate formation lawyers handle the whole set-up end to end.
The 15-point startup legal checklist
Work through these in order. Steps 1 to 7 are the "must do before you trade" core; steps 8 to 15 protect and future-proof the business.
| # | Task | Governing law / authority |
|---|---|---|
| 1 | Choose your legal structure | Companies Act 2017 / LLP Act 2017 / Partnership Act 1932 |
| 2 | Reserve your company name | SECP eZfile |
| 3 | Draft the Memorandum & Articles | Companies Act 2017 |
| 4 | Incorporate with the SECP | SECP |
| 5 | Obtain your NTN from the FBR | Income Tax Ordinance 2001 |
| 6 | Register for sales tax (if applicable) | Sales Tax Act 1990 / provincial authority |
| 7 | Open a corporate bank account | Bank / SBP KYC |
| 8 | Sign a founders / shareholders agreement | Contract Act 1872 |
| 9 | Fix the cap table and share vesting | Companies Act 2017 |
| 10 | Register your trademark | Trademarks Ordinance 2001 (IPO Pakistan) |
| 11 | Secure copyright, patents and domains | Copyright Ordinance 1962 / Patents Ordinance 2000 |
| 12 | Put core contracts in place | Contract Act 1872 |
| 13 | Add employment terms and IP assignment | Labour laws / Contract Act 1872 |
| 14 | Obtain sector licences and PSEB / EOBI registration | Sector regulators / EOBI Act 1976 |
| 15 | Set up your compliance calendar | SECP & FBR |
1. Pick the right legal structure
Your structure decides your liability, tax and how easily you can raise money. Founders in Pakistan usually choose from four options:
| Structure | Best for | Liability | Governing law |
|---|---|---|---|
| Sole proprietorship | Solo, low-risk trading | Unlimited (personal) | Registered via FBR NTN |
| Partnership firm | 2+ partners, simple set-up | Unlimited, joint | Partnership Act 1932 |
| LLP | Professional partners | Limited | LLP Act 2017 |
| Private limited (Pvt Ltd / SMC) | Funded / growth startups | Limited | Companies Act 2017 |
Most startups that plan to hire, raise investment or scale register a private limited company for its limited liability and clean cap table. A solo founder can incorporate a single member company (SMC), while professional service partners often prefer an LLP. Lighter options are a sole proprietorship or a partnership firm. For a full side-by-side, see our pillar on types of company registration in Pakistan.
2-4. Reserve, draft and incorporate with the SECP
Company formation runs through the SECP's eZfile portal under the Companies Act 2017. A private company needs a minimum of two shareholders and two directors (they can be the same people); an SMC needs one. First, reserve your name (fee PKR 1,000, effective November 2024) and set up a portal user (one-time PKR 200). Then draft the Memorandum and Articles of Association - the MoA sets your objects and the AoA your internal rules. Finally submit incorporation with directors' CNICs; SECP government fees start from around PKR 1,800 for authorised capital up to PKR 100,000. The minimum authorised capital is just PKR 10,000, and you do not deposit it. If documents are clean, incorporation typically completes in 2 to 5 working days. Our step-by-step walkthroughs cover how to register a company with the SECP and the eZfile name reservation and incorporation flow.
5-7. NTN, sales tax and a corporate bank account
Incorporation gives you a legal entity; tax registration lets it trade. Your National Tax Number (NTN) is issued by the FBR through the IRIS portal and is often generated alongside the incorporation certificate - see our guide to NTN registration online. If you supply taxable goods or services, register for sales tax under the Sales Tax Act 1990 with the FBR, and with the relevant provincial authority (PRA, SRB, KPRA or BRA) for services. With your incorporation certificate, NTN, MoA/AoA and directors' CNICs, you can then open a corporate bank account to keep company money separate from personal funds - a point investors and auditors check. Understand how your entity is taxed in our note on business tax in Pakistan.
IT and software export startups should consider PSEB registration. Startups registered with the Pakistan Software Export Board can qualify for a three-year income tax exemption from the year of incorporation, plus other incentives - a material saving worth confirming before launch.
8-9. Founders agreement and cap table
The single most valuable document a startup signs early is a founders (or shareholders) agreement under the Contract Act 1872. It records who owns what, how shares vest over time, roles and responsibilities, decision and voting rights, what happens if a founder leaves, and how disputes are resolved. Pair it with a clean cap table so equity is documented from day one and future investment rounds slot in cleanly. This is the step founders most often skip - and most often regret. Our contract drafting team prepares founders and shareholders agreements tailored to your split.
10-11. Protect your brand and IP
Your name and product are assets - register them before someone else does. File a trademark with IPO Pakistan under the Trademarks Ordinance 2001. Applications are filed class by class under the Nice Classification, giving ten years of protection (renewable indefinitely); official fees run roughly PKR 4,000 to 6,000 per class, with total professional costs typically higher. See our pillar on trademark registration in Pakistan. Copyright in original work (code, content, designs) arises automatically under the Copyright Ordinance 1962 and lasts the author's life plus 50 years, but registering it strengthens enforcement. If you have a genuine invention, a patent under the Patents Ordinance 2000 protects it for 20 years. Our IP lawyers can file the full set.
12-13. Core contracts and employment terms
Handshake deals do not survive growth. Before launch, prepare the contracts you will actually use: customer terms and privacy policy, supplier and vendor agreements, NDAs, and employment or contractor agreements. Two clauses matter especially for startups - a robust IP assignment so that everything your team or freelancers create belongs to the company, and clear confidentiality terms. Ready-to-use starting points are in our legal forms library, and for bespoke commercial documents our commercial legal team can help.
14-15. Licences, EOBI and your compliance calendar
Check whether your sector needs a specific licence or regulator approval - fintech, food, health, education and financial services all do. Once you employ five or more workers, register with the EOBI under the EOBI Act 1976 (contributions of 5% employer plus 1% employee of the minimum wage) and the relevant provincial social security institution. Finally, build a compliance calendar: hold your AGM, file the annual return (Form A) with the SECP within 30 days of the AGM, report director changes on Form 29, and file annual income tax, sales tax and withholding statements with the FBR on time. Our guides to the SECP and FBR compliance calendar and annual returns (Form A and 29) keep you penalty-free, and our corporate tax team can manage filings for you.
Frequently asked questions
What legal steps are needed to launch a startup in Pakistan?
Choose a structure, incorporate with the SECP, get an NTN and register for sales tax where needed, sign a founders agreement, protect your trademark and IP, put core contracts in place, and set up a compliance calendar.
Which structure is best for a startup?
Funded or growth startups usually pick a private limited company for limited liability and a clean cap table. Solo founders can use an SMC; professional partners often prefer an LLP.
How much does registration cost?
SECP government fees start near PKR 1,800 for online incorporation up to PKR 100,000 capital, plus a PKR 1,000 name fee and a one-time PKR 200 user fee. Professional and drafting fees are separate and vary - confirm a fixed quote first.
Do I need a trademark before launching?
It is strongly advised. Trademarks are filed class by class with IPO Pakistan under the Trademarks Ordinance 2001 and give ten years of protection. Filing early secures the brand you are investing in.
Is a founders agreement legally required?
No, but it is essential. It records equity splits, vesting, roles, decision rights and exit terms, and prevents the most common co-founder disputes.
What ongoing filings must a new company make?
An AGM, the annual return (Form A) within 30 days of the AGM, Form 29 for director changes, annual FBR income tax returns, and sales tax, withholding and EOBI obligations where they apply.