Setting up a business in Pakistan is not a single registration - it is a short sequence of them, and the order matters. Miss a step and you can end up unable to open a corporate bank account, invoice clients, or claim input tax. This checklist walks you through each registration a new business needs, from choosing a legal structure to your first monthly sales tax return, with the governing statute, realistic timelines and typical costs. For an end-to-end setup, our tax planning and advisory team handles the whole chain.
Step 1: Choose your business structure
Your legal structure decides which registrations apply. A sole proprietor deals only with the FBR; an association of persons (AOP, i.e. a partnership) registers its firm; a company incorporates with the Securities and Exchange Commission of Pakistan (SECP) before it ever touches the FBR. Get this decision right first - it shapes your tax rate, your paperwork and your liability.
| Structure | Registered with | Governing law | Best for |
|---|---|---|---|
| Sole proprietor | FBR (NTN only) | Income Tax Ordinance 2001 | Freelancers, small traders |
| Partnership / AOP | Registrar of Firms + FBR | Partnership Act 1932 | Two or more owners |
| Private limited company | SECP + FBR | Companies Act 2017 | Growth, investors, limited liability |
| Single member company (SMC) | SECP + FBR | Companies Act 2017 | One owner wanting limited liability |
Not sure which fits? Our guide to business tax for sole traders, AOPs and companies compares the tax treatment of each in detail.
Step 2: Incorporate with SECP (companies only)
If you chose a company, incorporation comes before tax registration. SECP now runs the process online through its eZfile portal. You reserve a name, submit the memorandum and articles of association, and receive a Certificate of Incorporation. Sole proprietors and partnerships skip this step entirely.
Fees are modest and capital-based. Online name reservation is around PKR 200, and incorporation filing starts near PKR 1,800 for authorised capital up to PKR 100,000, rising in steps as capital increases. If documents are complete, SECP can approve in as little as 2 to 3 working days, though 5 to 7 days is more typical.
Order matters: a company must have its SECP incorporation certificate before it can obtain a corporate NTN. Sole traders and AOPs go straight to the FBR.
Step 3: Get your NTN from the FBR
The National Tax Number is the base registration for every business and the one nobody can skip. You apply free of charge through the FBR's IRIS portal at iris.fbr.gov.pk, and for individuals it is usually issued within 24 to 48 hours. Registration is provided for under section 181 of the Income Tax Ordinance 2001.
For an individual or sole proprietor you will need:
- A valid CNIC
- A mobile number registered in your own name and a personal email
- Proof of business address (utility bill or tenancy)
- A bank account maintenance certificate
Companies and AOPs register the entity and its principal officer, attaching the SECP certificate or partnership deed. Our step-by-step NTN registration guide covers each IRIS screen. Once you hold an NTN, check whether you appear on the Active Taxpayers List - being a filer sharply cuts your withholding costs.
Step 4: Register for sales tax (goods vs services)
Sales tax registration is where most founders get confused, because Pakistan splits it in two. Goods are federal, administered by the FBR under the Sales Tax Act 1990. Services are provincial, administered by whichever revenue authority governs the province you operate in. You may need one, both, or neither.
For federal sales tax on goods you need a live NTN and IRIS account first, then apply for a Sales Tax Registration Number (STRN) inside IRIS. The standard federal sales tax rate is 18%, and registered persons file a monthly return by the 15th of the following month. Registration is dealt with under section 14 of the Sales Tax Act 1990. See our full guide to sales tax registration, rates and returns.
The line between federal goods tax and provincial services tax is a common trap - our explainer on federal vs provincial sales tax on services untangles it.
Step 5: Provincial registration for services
If you sell services - consulting, IT, restaurants, marketing, transport - you register with your province's revenue authority, not the FBR, and you charge that province's rate. Each authority has its own portal and its own governing Act.
| Province | Authority | Standard services rate | Governing law |
|---|---|---|---|
| Punjab | PRA | 16% | Punjab Sales Tax on Services Act 2012 |
| Sindh | SRB | 15% | Sindh Sales Tax on Services Act 2011 |
| Khyber Pakhtunkhwa | KPRA | 15% | KP Finance Act 2013 |
| Balochistan | BRA | 15% | Balochistan Sales Tax on Services Act 2015 |
Telecommunication services are taxed higher - typically 19.5% in Punjab and Sindh. Reduced rates apply to some sectors, and if you operate in more than one province you may need multiple provincial registrations. Rates and exemptions change with each provincial budget, so confirm the current position before you invoice.
The full registration checklist
Here is the complete sequence in one place. Not every business needs every row - a salaried freelancer may only need the first two - but this is the full menu, in order.
| # | Registration | Where | Who needs it | Typical time |
|---|---|---|---|---|
| 1 | Legal structure decided | - | Everyone | Day 0 |
| 2 | SECP incorporation | SECP eZfile | Companies / SMC | 2-7 days |
| 3 | NTN (income tax) | FBR IRIS | Everyone | 24-48 hrs |
| 4 | Business bank account | Your bank | Everyone | 1-3 days |
| 5 | Federal sales tax (STRN) | FBR IRIS | Goods suppliers | 3-7 days |
| 6 | Provincial services tax | PRA / SRB / KPRA / BRA | Service providers | 2-5 days |
| 7 | Chamber / trade licence | Local body | Sector-specific | Varies |
Where exact fees are quoted above they are indicative and move with each budget and with your capital and turnover; treat them as a guide, not a quote. For a firm figure tailored to your setup, book a consultation.
After registration: staying compliant
Registration is the start, not the finish. Once you hold an NTN you must file an annual income tax return; once you hold an STRN you must file monthly sales tax returns even in months with no sales. Miss a deadline and default surcharge and penalties follow - our guide to tax penalties and default surcharge sets out the cost. Staying on the Active Taxpayers List also keeps your filer status intact and your withholding low. Businesses also account for withholding tax when they pay suppliers and staff.
Frequently asked questions
What is the first tax registration a new business needs?
An NTN from the FBR. It is free, issued through IRIS in about 24 to 48 hours, and is the base every business must hold before sales tax or a corporate bank account.
Do I need to register for sales tax when I start?
Only if you supply taxable goods (federal, FBR) or provide taxable services (provincial - PRA, SRB, KPRA or BRA). Many small businesses do not need it on day one.
What is the difference between an NTN and an STRN?
The NTN is your income tax identity; the STRN lets you charge and reclaim sales tax. You need an NTN and an active IRIS account before you can apply for an STRN.
Does a sole proprietor register with SECP?
No. Sole proprietors only need an NTN. SECP incorporation is for companies and SMCs; partnerships register with the Registrar of Firms.
How long does full registration take?
An NTN in 24 to 48 hours, SECP incorporation in 2 to 7 days, sales tax in 3 to 7 days - so a company can be fully registered within roughly two weeks.
What documents do I need?
For an NTN: CNIC, registered mobile and email, proof of address and a bank account. For sales tax, add premises utility bills and a lease or ownership document; companies add their SECP certificate.