Starting a new business in Pakistan requires registering with FBR for income tax (NTN), and possibly with SECP for company formation and FBR for sales tax (STRN). Each registration has its own process, documents, timeline, and fee. This guide covers all three so you can start your business legally and on time.
Three Registrations Every New Business Needs
| Registration | Authority | Who Needs It | Timeline |
|---|---|---|---|
| NTN (Income Tax) | FBR / IRIS | Every business | Same day – 2 days |
| Sales Tax STRN | FBR / IRIS | Businesses with taxable sales above Rs. 10M/year OR supplying to registered buyers | 3–7 days |
| Company Registration | SECP | Private Limited / SMC / LLP | 7–14 days |
Sole proprietors and small shops only need NTN. Businesses supplying to other registered businesses (B2B) need STRN. Businesses wanting limited liability need SECP registration.
NTN Registration for New Business
NTN for a business (sole proprietorship or AOP) is done through IRIS:
- Go to iris.fbr.gov.pk → New Registration → Select "AOP" or "Individual Business"
- Enter owner CNIC, business name, business address, nature of business
- Upload: CNIC copies, rent agreement or property ownership for business premises
- FBR assigns NTN within 24–48 hours
Sole proprietor: Your personal CNIC-linked NTN is the same as the business NTN. No separate NTN is issued — the business files under the owner's NTN. For AOP (partnership), a separate AOP NTN is created with the firm name.
Sales Tax Registration (STRN) — Who Needs It
You must register for Sales Tax (STRN) if:
- Annual taxable turnover exceeds Rs. 10,000,000 (Rs. 10 million)
- You supply goods or services to sales-tax-registered companies (they require your STRN to claim input tax)
- You import or export goods (mandatory)
- You manufacture goods (mandatory regardless of turnover)
| Business Type | STRN Required? |
|---|---|
| Manufacturer (any size) | Yes — mandatory |
| Importer / Exporter | Yes — mandatory |
| Retailer (sales above Rs. 10M) | Yes |
| Service provider (B2B above Rs. 10M) | Yes |
| Small shop / freelancer (under Rs. 10M) | No — exempt |
SECP Company Registration — Pvt Ltd vs Sole Proprietor
| Feature | Sole Proprietor | Private Limited (SECP) |
|---|---|---|
| Liability | Personal — unlimited | Limited to share capital |
| Cost | Rs. 0 – 2,500 | Rs. 15,000 – 25,000 (varies) |
| Bank account | Personal account usable | Must open corporate account |
| Foreign clients (B2B) | Acceptable for many | Preferred by multinationals |
| SECP compliance | None required | Annual return + audit required |
| Tax rate | Individual slabs (up to 35%) | 29% flat corporate rate |
Freelancers: Sole proprietorship is sufficient for most freelancers. Pvt Ltd is beneficial when working with large international clients who require a legal entity. Kamboh Associates can advise on which is better for your specific situation.
Complete Documents for Business Registration
| Document | NTN | STRN | SECP |
|---|---|---|---|
| Owner / director CNICs | Required | Required | Required (all directors) |
| Business name | Required | Required | Must be approved by SECP |
| Business address | Required | Required | Required (registered office) |
| Rent agreement / ownership proof | Required | Required | Required |
| Bank account statement | Optional | Optional | Required (paid-up capital) |
| Memorandum & Articles of Association | N/A | N/A | Required |
Frequently Asked Questions
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