How to register a non-profit organization (NPO) in Pakistan

Introduction

With rising social, environmental, and humanitarian challenges, many individuals and groups in Pakistan are taking the initiative to establish Non-Profit Organizations (NPOs) to serve the public good. Whether you’re aiming to launch a charity, foundation, welfare society, or public interest group, it’s crucial to follow the legal framework for NPO registration in Pakistan.

This 2025 guide walks you through the types of non-profit structures, registration procedures with the SECP, Registrar of Societies, or Trust Registrar, applicable tax laws, and compliance requirements for operating a legally recognized and tax-exempt NPO in Pakistan.

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Table of Contents

1. What is a Non-Profit Organization (NPO)?

2. Legal Structures for NPOs in Pakistan

3. Choosing the Right Structure: Trust vs Society vs Section 42 Company

4. Documents Required for NPO Registration

5. How to Register a Section 42 Company (SECP)

6. How to Register a Welfare Society (Societies Registration Act)

7. How to Register a Public Trust

8. Tax Registration and Exemption Process with FBR

9. Compliance Requirements for NPOs

10. Benefits of Registering an NPO

11. Challenges Faced by NPOs in Pakistan

12. FAQs

13. How Sterling.pk Can Help

14. Conclusion

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1. What is a Non-Profit Organization (NPO)?

A Non-Profit Organization (NPO) is an entity established to pursue charitable, social, religious, educational, or public welfare objectives. Unlike commercial entities, NPOs do not distribute profits to members or shareholders and are typically eligible for tax exemptions if registered properly.

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2. Legal Structures for NPOs in Pakistan

You can register an NPO in Pakistan under one of the following legal structures:

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3. Choosing the Right Structure: Trust vs Society vs Section 42 Company

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4. Documents Required for NPO Registration

The documentation depends on the structure. However, commonly required documents include:

✅ CNIC copies of all members
✅ Proof of registered office (rental agreement or ownership documents)
✅ Memorandum and Articles of Association (for Section 42)
✅ Rules and Regulations/Bylaws (for Societies)
✅ Trust Deed (for Trusts)
✅ Affidavit or undertaking by promoters
✅ No Objection Certificate (NOC) from local police or deputy commissioner (in some cases)
✅ Bank challans or fee deposit slips

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5. How to Register a Section 42 Company (with SECP)

A Section 42 Company is the most structured and credible form of NPO in Pakistan.

Step-by-Step Procedure:

Step 1: Name Reservation

• Apply through SECP eServices Portal

• Pay Rs. 200 fee and obtain name availability certificate

Step 2: Apply for License from SECP

• Submit online application with:

  • Draft MOA and AOA

  • Brief profile of proposed directors

  • Vision/mission statement

  • Justification for registration

  • Recommendation letter from concerned ministry (for health/education)

Step 3: Incorporation Filing

• After license approval, file incorporation documents including:

  • MOA/AOA

  • Form 1 (Declaration)

  • Form 21 (Registered Office)

  • Form 29 (Director Particulars)

• Pay prescribed fee based on capital (typically Rs. 10,000–20,000)

Timeline: 30–60 working days

Output: Certificate of Incorporation under Section 42

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6. How to Register a Welfare Society (under Societies Registration Act, 1860)

Step-by-Step Procedure:

1. Draft Rules and Regulations of the society

2. Prepare Memorandum of Association with at least 7 founding members

3. Submit application to the Provincial Registrar of Societies along with:

   • CNICs of members

   • Address of office

   • Signed MOA and rules

   • Bank deposit slip of nominal fee (varies by province)

4. Registrar reviews and may conduct inspection/interview

5. Registration certificate issued upon approval

Timeline: 15–30 working days

Validity: Indefinite (subject to compliance)

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7. How to Register a Public Charitable Trust

A Public Trust is generally set up for religious, educational, or public purposes.

Procedure:

1. Draft a Trust Deed

2. Appoint at least 2 trustees

3. Register the trust deed with the Sub-Registrar or Civil Court

4. Obtain certified copy of the trust deed for official purposes

5. Open a bank account in the name of the trust

Timeline: 15–25 working days

Legal Status: Trusts are not separate legal entities (no personality)

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8. Tax Registration and Exemption Process with FBR

A. NTN Registration

• All NPOs must register with FBR via IRIS portal

• Submit:

  • SECP/Society/Trust registration certificate

  • Office lease deed

  • CNICs of signatories

  • MOA or Trust Deed

B. Apply for Tax Exempt Status (Under Section 2(36) and 100C of ITO, 2001)

• Submit application for approval as an NPO with:

  • Audited financials (if operational)

  • Activities report

  • Organizational chart

  • Registration documents

C. Filing Returns

Once exempt, file Form 990-type return (Part D of ITR form) annually with:

✅ Donor details
✅ Expense breakdown
✅ Annual activity report

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9. Compliance Requirements for NPOs

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10. Benefits of Registering an NPO in Pakistan

✅ Tax Exemption on donations, grants, and foreign funding
✅ Credibility with donors, banks, and government
✅ Legal recognition for contracts, property ownership, and banking
✅ Eligibility for local and international funding
✅ Access to PSEB, SDGs, and CSR partnerships

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11. Challenges Faced by NPOs in Pakistan

❌ Complex and time-consuming registration procedures
❌ High compliance burden for Section 42 companies
❌ Tax exemption scrutiny from FBR
❌ Restrictions on foreign funding without MOI/NOC
❌ Inconsistent provincial processes for societies/trusts
❌ Low awareness among donors about legal status verification

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12. FAQs

Q1: Can I receive donations without registering my NPO?
You may receive donations informally, but without registration, you cannot open a bank account or issue tax-deductible receipts.

Q2: What is the minimum number of members required to form an NPO?

• Section 42 company: 3 directors

• Society: Minimum 7 members

• Trust: Minimum 2 trustees

Q3: Is foreign funding allowed for NPOs?
Yes, but NOCs from Ministry of Interior (MOI) and SBP may be required.

Q4: Can an NPO own property in Pakistan?
Yes, if it is a registered legal entity (especially Section 42 or Society).

Q5: Is audit mandatory for all NPOs?
Mandatory for Section 42 companies and large NPOs seeking tax exemption.

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13. How Sterling.pk Can Help

At Sterling.pk, we assist individuals and organizations in setting up and managing NPOs with services including:

✅ Choosing the right structure (Company, Society, Trust)
✅ Drafting MOA, bylaws, and trust deeds
✅ Filing with SECP, Society Registrar, or Court
✅ NTN registration and tax exemption filing
✅ FBR compliance and annual returns
✅ Foreign funding approval (MOI & SBP NOC)
✅ Setting up chart of accounts and audit preparation

We help you focus on your mission while we handle the compliance and legalities.

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14. Conclusion

Registering a non-profit organization in Pakistan is a legally structured process that provides legitimacy, tax benefits, and access to funding opportunities. While multiple structures exist (Section 42 company, society, or trust), choosing the right one depends on your organization’s scope, vision, and future plans.

By following the proper registration process and maintaining regulatory compliance, you can build a transparent, impactful, and sustainable NPO that contributes meaningfully to society. With professional guidance from Sterling.pk, you can ensure that your organization operates within the law and gains the trust of stakeholders and donors.