Company formation
Registering a Partnership Firm in Pakistan
A partnership is registered with the Registrar of Firms under section 58 of the Partnership Act 1932, not with SECP. In Islamabad Capital Territory that means Form No. 1 signed by every partner before a qualified witness, a partnership deed on Rs 1,000 stamp paper, a Rs 1,000 fee, and about ten days. Registration is provincial, so the fee and the counter change with the province. Above twenty partners the law stops allowing a partnership at all.
We do this for clients:Company Registration in Pakistan
Where these figures come from
- Sources
- Sourced from the Partnership Act 1932 and the Income Tax Ordinance, 2001.
- Last checked against the sources
- by BarrioVibe.
This is general guidance from the sources above, not advice on your situation. Procedures and official fees change, so confirm the current position before you file, or speak to us first.
What registration involves in Islamabad Capital Territory
These are the ICT Administration's own requirements. Registration is province-specific: Punjab, Sindh and KP run their own registries and their own fees, so confirm locally before budgeting.
- 1
Draw up the partnership deed
On Rs 1,000 stamp paper. This is the document that decides profit shares, authority, admission and retirement of partners, and what happens on a dispute. It is worth more attention than the registration itself.
- 2
Complete Form No. 1
The statutory application under section 58. It must be signed by all the partners before a witness who is a Gazetted Officer, an Advocate, an Attorney, a Pleader or an Honorary Magistrate. An ordinary witness will not do.
- 3
Prepare the affidavit and identity documents
An affidavit on Rs 5 stamp paper, plus CNICs of all partners and of the witnesses, all notarised.
- 4
Pay the fee
Rs 1,000 to National Bank under head C-03545 for ICT. Note the preprinted Form No. 1 still reads "Filing Fee Rs.100/-": the form is stale and the challan is what counts.
- 5
Attend in person
Partners appear before the Registrar. This is not a portal process in the way SECP incorporation now is.
- 6
Collect the certificate
About ten days in ICT on the Administration's own account.
Registration is optional, and mostly not optional in practice
The Partnership Act does not compel registration. A partnership exists in law from the moment people agree to share the profits of a business carried on by all or any of them acting for all, whether or not anything is filed.
What registration buys is the ability to sue. An unregistered firm is severely restricted in enforcing contractual rights through the courts, and a partner in one is restricted in suing the firm or the other partners. Banks and larger customers also generally want the certificate before opening an account or onboarding a vendor. So it is voluntary in the way that having a lock on your door is voluntary.
Partnership, single member company, or sole proprietorship
The three routes people actually choose between, and the questions that separate them. Liability is the one that decides most cases and is the one most often left out of the comparison.
| Partnership firm | Single member company | Sole proprietorship | |
|---|---|---|---|
| Registered with | Registrar of Firms | SECP | Nobody |
| Minimum people | Two | One | One |
| Liability | Unlimited, personal | Limited to the company | Unlimited, personal |
| Separate legal person | No | Yes | No |
| Annual filing with the registrar | No | Yes | No |
How a partnership is taxed
A partnership firm is an association of persons for income tax, taxed on the non-salaried rate table in its own right. The firm pays, and the share a partner receives from a taxed association is not taxed again in the partner's hands.
That last point matters more than it sounds, because it is the structural difference from a company. A company pays corporate tax and then a distribution to shareholders can attract tax on dividends. An association is taxed once. Whether that makes an association cheaper depends entirely on the numbers, and the top of the non-salaried table is higher than the corporate rate, so it is genuinely a calculation rather than a rule of thumb.
What the firm would pay on its income
The non-salaried table is what an association of persons is taxed on. Enter the firm's taxable income to see the figure and the marginal rate it lands in.
Business & AOP TaxQuestions
The questionspeople ask
Where do I register a partnership firm in Pakistan?
With the Registrar of Firms under section 58 of the Partnership Act 1932, which is a provincial office, not with SECP. SECP registers companies and limited liability partnerships only.
How much does it cost to register a partnership in Pakistan?
In Islamabad Capital Territory the fee is Rs 1,000 paid to National Bank under head C-03545, plus a partnership deed on Rs 1,000 stamp paper and an affidavit on Rs 5 stamp paper. Other provinces set their own fees. Note that the preprinted Form No. 1 still shows Rs 100, which is out of date.
How long does partnership registration take?
About ten days in Islamabad Capital Territory on the Administration's own account, once Form No. 1, the deed, the affidavit and the notarised CNICs are in and the partners have appeared in person.
Is partnership registration compulsory in Pakistan?
No. A partnership exists in law from the agreement itself. But an unregistered firm is severely restricted in enforcing its contracts through the courts, and banks and larger customers usually ask for the certificate, so unregistered is a weak position rather than a free one.
How many partners can a partnership have in Pakistan?
Twenty. Section 9(1) of the Companies Act 2017 prohibits an association or partnership of more than twenty persons formed for gain unless it registers as a company, and section 9(2) makes everyone in violation personally liable for all the business's liabilities. Partnerships of lawyers, accountants and similar professions are carved out by section 9(3)(d).
Who can witness Form No. 1?
A Gazetted Officer, an Advocate, an Attorney, a Pleader or an Honorary Magistrate. All partners must sign before that witness, which is why the form cannot simply be signed and posted.
Is a partnership taxed separately from the partners?
Yes. The firm is an association of persons and is taxed in its own right on the non-salaried rate table. A partner's share from an association that has been taxed is not taxed again in the partner's hands.
Does a registered partnership need an NTN?
Yes, and it is separate from registration with the Registrar of Firms. Once the firm holds an NTN, section 114(1)(b)(vii) requires a return every year whatever the firm earned. Partners file their own returns as well.
Also here
Relatedguides
Choosing a structure
What actually differs between the three, the audit thresholds everyone gets wrong, and the statutory points at which the answer changes.
How to get an NTN
Registration is free, a salaried person attaches no documents, and the step most people miss is the one that actually completes it.
Rather have someone handle it?
We file returns through IRIS every day. If the answer above raises a question about your own case, that is the conversation to have before the deadline rather than after it.