Introduction
With Pakistan becoming a growing destination for foreign direct investment and international trade, many entrepreneurs and companies are looking to establish a presence through offshore or foreign-owned companies. While the term “offshore company” usually refers to an entity registered outside the investor’s home country, in the context of Pakistan, it often refers to a foreign company registering a branch, liaison office, or subsidiary in Pakistan to conduct local or limited operations.
This comprehensive 2025 guide explains how to register an offshore or foreign company in Pakistan, covering legal structures, documentation, regulatory approvals, tax implications, and key compliance requirements for international investors and corporations.
Table of Contents
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1. What Is an Offshore Company in the Context of Pakistan?
In Pakistan, an “offshore company” generally refers to a foreign entity operating within Pakistan without being locally incorporated, usually through:
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A branch office
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A liaison office
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A wholly-owned subsidiary
Such companies are incorporated outside Pakistan but are authorized to do business or coordination activities within the country, subject to SECP and BOI approval.
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2. Legal Options for Foreign Businesses
Foreign investors can choose from the following legal vehicles:
| Type | Description |
|---|---|
| Branch Office | Extension of foreign company with commercial activities |
| Liaison Office | Communication-only office with no commercial activity |
| Wholly-Owned Subsidiary | Locally registered private limited company with foreign ownership |
| Joint Venture | Partnership between a local and foreign business entity |
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3. Key Authorities Involved
| Authority | Role |
|---|---|
| SECP | Registration of companies and foreign offices |
| Board of Investment (BOI) | Approval for branch and liaison offices |
| FBR | Tax registration and ATL compliance |
| State Bank of Pakistan (SBP) | Capital remittance and repatriation permissions |
| Provincial Revenue Boards | Sales tax on services registration, if applicable |
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4. Branch Office vs Liaison Office vs Subsidiary
| Feature | Branch Office | Liaison Office | Subsidiary (Pvt Ltd) |
|---|---|---|---|
| Legal Status | Extension of foreign entity | Extension of foreign entity | Separate legal entity |
| Commercial Activity | Yes (with approval) | No | Yes |
| BOI Approval | Required | Required | Not required |
| SECP Registration | Required | Required | Required |
| FBR Tax Status | Non-resident | Non-resident | Resident |
| Profit Repatriation | Restricted | N/A | Allowed via SBP |
| Max Tenure | 3–5 years (renewable) | 3–5 years (renewable) | Unlimited |
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5. Requirements to Register an Offshore Company in Pakistan
To register a branch or liaison office, a foreign company must:
✅ Be legally incorporated in its home country
✅ Provide a board resolution to operate in Pakistan
✅ Obtain approval from the Board of Investment (BOI)
✅ Register with the SECP as a foreign company
✅ Comply with FBR and SBP regulations
✅ Appoint a local authorized representative or attorney
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6. Step-by-Step Registration Process
A. For Branch or Liaison Office:
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Apply for permission from the Board of Investment (BOI)
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Submit detailed documents and proposed activity plan
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Obtain BOI license for 3–5 years
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Register with SECP as a foreign company
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Obtain NTN and register with FBR
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Open a bank account and remit initial capital
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Start operations as per license
B. For Subsidiary Company:
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Reserve a company name on SECP’s eServices portal
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Prepare MOA/AOA and incorporation documents
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File incorporation application and pay SECP fee
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Receive Certificate of Incorporation
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Register with FBR and obtain NTN/STRN
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Open bank account and remit foreign capital
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Register with BOI (optional) for special incentives
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7. Required Documents
| Document | Required For |
|---|---|
| Certificate of Incorporation (Parent Company) | BOI and SECP |
| Board Resolution to Establish Pakistani Office | BOI |
| Company Profile and Business Plan | BOI |
| Passport copies of directors | BOI/SECP |
| Audited financials (past 3 years) | BOI (for branch/liaison) |
| Office tenancy agreement in Pakistan | SECP |
| Power of Attorney to local representative | SECP/BOI |
| Bank reference letter | BOI/SECP |
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8. Approval from Board of Investment (BOI)
BOI approval is mandatory for:
✅ Branch offices
✅ Liaison offices
Procedure:
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Submit online application via BOI Portal
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Pay processing fee (approx. USD 300–500)
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Upload documents including detailed business plan
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BOI reviews and grants permission within 4–6 weeks
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Approval valid for 3 to 5 years, renewable
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9. FBR and Tax Registrations
All offshore companies must register with the Federal Board of Revenue (FBR):
| Registration | Required For |
|---|---|
| NTN | All types of companies |
| STRN (Sales Tax) | If engaged in taxable activities |
| ATL (Active Taxpayer List) | To reduce withholding taxes and file returns |
Documents for FBR:
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SECP certificate
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Director CNICs/passports
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Company’s Pakistan address
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Proof of business activity
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10. Bank Account Opening & Capital Remittance
Foreign companies must:
✅ Open a PKR and foreign currency account in a local bank
✅ Receive initial capital through legitimate remittance channels
✅ Obtain FIRC (Foreign Inward Remittance Certificate)
✅ Report remittance to SBP via bank
Note: Only authorized banks can process remittances under SBP’s foreign exchange regulations.
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11. Post-Incorporation Compliance
| Compliance Area | Frequency | Responsible Authority |
|---|---|---|
| Income Tax Return Filing | Annually | FBR |
| Sales Tax Return Filing | Monthly (if applicable) | FBR/PRA/KPRA/SRB |
| SECP Annual Returns (Form 45, Form 29) | Annually/as needed | SECP |
| Financial Statements (audited) | Annually | SECP/FBR |
| License Renewal (BOI) | Every 3–5 years | BOI |
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12. Offshore Company Taxation in Pakistan
| Tax Type | Applicable Rate | Notes |
|---|---|---|
| Corporate Income Tax | 29% | On income sourced in Pakistan |
| Minimum Tax | 1.25% of turnover | If profit is lower than threshold |
| Sales Tax (Goods) | 18% | If applicable |
| Services Tax | 13–16% | Depends on province |
| WHT on Remittances | 15% (adjustable/treaty) | On dividends or branch profits |
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13. Renewal and Extension Procedures
For branch or liaison offices, renewal is through BOI:
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Submit renewal request at least 30 days before expiry
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Provide updated financials and operations report
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Renewal fee applies (USD 300–500)
For subsidiaries, no renewal is required if compliance is ongoing.
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14. Common Challenges and Mistakes
❌ Delayed BOI approval due to incomplete documents
❌ Using wrong structure (e.g., liaison office for commercial activity)
❌ Lack of understanding of SBP remittance rules
❌ Missing SECP compliance (Form A, B, 45)
❌ Inadequate local representation
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15. FAQs
Q1: Can a foreign company own 100% of a Pakistani business?
Yes, except in restricted sectors (e.g., defense, arms, radio). 100% foreign ownership is allowed in most commercial sectors.
Q2: What’s the difference between a branch and a subsidiary?
A branch is an extension of the parent company. A subsidiary is a separate legal entity incorporated in Pakistan.
Q3: Do I need BOI approval for a subsidiary?
Not mandatory but recommended to access investment incentives and repatriation approval.
Q4: Can I repatriate profits from Pakistan?
Yes, with proper tax clearance and SBP reporting. Dividends and branch profits are subject to WHT.
Q5: How long does it take to register a branch or liaison office?
6–8 weeks including BOI and SECP approval.
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16. How Sterling.pk Can Help
At Sterling.pk, we specialize in setting up offshore and foreign-owned entities in Pakistan by providing:
✅ BOI approval application and coordination
✅ SECP company registration (branch, liaison, subsidiary)
✅ Tax registration (NTN, STRN, ATL)
✅ Bank account opening and capital remittance support
✅ Monthly tax filing and compliance services
✅ Foreign director and legal documentation advisory
With our expert team, you can navigate Pakistan’s corporate regulations smoothly and securely.
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Conclusion
Registering an offshore or foreign-owned company in Pakistan opens the door to vast business opportunities, a growing market, and regional expansion potential. Whether through a branch, liaison office, or subsidiary, foreign investors can legally and efficiently establish their presence with the right guidance.
By understanding the legal process, documentation, and regulatory landscape—and working with experienced consultants like Sterling.pk—you can confidently expand your global footprint into Pakistan.
