Registration of Sole Proprietorship in Pakistan

For sole proprietorship registration, you’ll need a copy of your CNIC, proof of your business address, the chosen business name, a completed NTN application, and possibly a bank account opening letter. For sales tax registration, additional documentation such as a rental agreement or utility bill for business premises may be required.

Registering a sole proprietorship typically takes 3-7 business days, depending on the FBR's processing time and document verification. Additional registrations, like sales tax or professional trade licenses, may add a few more days to the process.

No, sole proprietorships in Pakistan do not require registration with the Securities and Exchange Commission of Pakistan (SECP). SECP registration is mandatory only for companies. Sole proprietors need to register primarily with the FBR to obtain an NTN.

The cost to register a sole proprietorship in Pakistan is minimal. You only pay for the NTN registration, which is free of charge through the FBR. However, if you need professional licenses, trade authority fees, or a tax advisor’s assistance, these may add to the total cost.

Yes, obtaining an NTN (National Tax Number) is essential for all sole proprietors in Pakistan. The NTN is required for tax purposes and allows you to legally operate and conduct business. It is also necessary for opening a business bank account and other official purposes.

Yes, after registering for an NTN, you can open a bank account under your sole proprietorship's business name. Most banks will require the NTN certificate, a copy of your CNIC, proof of address, and a letter of request to open an account in your business name.

Sole proprietorships are subject to income tax, which is calculated on the owner’s income tax bracket since the business income is treated as personal income. Depending on the nature of the business, sales tax or professional tax may also apply.

In some cases, yes. Trade licenses may be required depending on the type of business and location. For example, if you’re operating a retail store or providing specific professional services, a trade license from your local trade authority or municipal corporation may be necessary.

Yes, a sole proprietorship can be converted to a private limited company by incorporating with the SECP. This involves re-registering the business, updating tax information, and obtaining a new NTN. Converting can offer benefits like limited liability and better access to financing.

Registering as a sole proprietorship is a simple, low-cost option with fewer regulatory requirements compared to other business structures. It allows the owner full control of business decisions, requires minimal paperwork, and has straightforward tax obligations, making it an attractive choice for small business owners.

You can apply for an NTN for your sole proprietorship online through the Federal Board of Revenue’s (FBR) IRIS portal. Register on IRIS, complete the online NTN application form with your business details, attach the necessary documents, and submit it. Once processed, you’ll receive your NTN certificate electronically.