Company Registration in Karachi: A Legal Guide for Foundations, Trusts & NGOs

The Three Main Legal Structures for Non-Profits

In Karachi, a non-profit organisation is usually set up in one of three ways. Each is governed by a different law and overseen by a different authority, which is why the choice matters.

Trust

A trust is created when the founder (the settlor) transfers property or funds to trustees, who hold and manage them for a stated charitable purpose under a written trust deed. Trusts are governed by the Trusts Act 1882 and are well suited to family foundations, endowments and organisations with a small, stable group of decision-makers.

Society

A society is a membership-based organisation run by an elected executive committee. In Sindh, societies are commonly registered under the Societies Registration Act 1860 or, for social welfare work, with the Social Welfare Department under the Voluntary Social Welfare Agencies law. This route suits community groups and membership-driven welfare bodies.

Section 42 Company

A Section 42 company is a not-for-profit company limited by guarantee under the Companies Act 2017. Before incorporation, the association must obtain a licence from the Securities and Exchange Commission of Pakistan (SECP). It carries the most formal governance, which many institutional donors and corporate partners prefer.

Trust vs Society vs Section 42 Company

How to Register: The General Process

The exact steps depend on the structure you choose, but the overall path looks like this.

1. Define your purpose and funding plan

   Write down what the organisation will do, who it will serve, and where money will come from. This determines which structure fits and what your governing documents must say.

2. Choose a name and confirm it is available

   The name must not duplicate or closely resemble an existing registered entity, and for companies it must be cleared through the SECP before use.

3. Draft your governing documents

   A trust needs a trust deed. A society needs a memorandum and bylaws. A Section 42 company needs a memorandum and articles of association. These documents set out objectives, powers, governance and what happens to assets if the organisation closes, so they are worth having a lawyer draft.

4. Apply to the correct authority

   Trusts are executed on stamp paper and registered with the Sub-Registrar. Societies apply to the Registrar of Societies or the Social Welfare Department. Section 42 companies first apply to the SECP for a licence, then incorporate as a company limited by guarantee.

5. Obtain your registration certificate

   Once the authority is satisfied, you receive your certificate or licence. Keep certified copies, as banks, donors and tax authorities will ask for them.

6. Open a bank account and complete tax registration

   Register for an NTN with the FBR and open an account in the organisation's name. If you want tax-exempt status, apply separately for approval as a non-profit organisation under the Income Tax Ordinance.

Documents You'll Typically Need

• CNIC copies of founders, trustees, members or directors
• Proposed name and a statement of objectives
• Trust deed, or memorandum and bylaws / articles, as applicable
• Details and signatures of the governing body (trustees, committee or board)
• Proof of the registered office address in Karachi
• Passport-size photographs and affidavits where required by the authority
• For conversions: attested copy of the existing registration certificate

Requirements and forms are updated from time to time, so confirm the current checklist with the relevant authority or your lawyer before filing.

Ongoing Compliance After Registration

Registration is the start, not the finish. Non-profits in Karachi are expected to keep their paperwork current, and regulators have shown they will act on lapses.

• Annual accounts and audit: keep proper books and have accounts audited. Organisations registered with the Sindh Social Welfare Department are expected to submit audit and activity reports.
• Regulatory filings: Section 42 companies file annual returns and accounts with the SECP, and the licence itself must be renewed periodically.
• Governance records: hold elections and meetings as your documents require and keep minutes.
• Charity regulation in Sindh: the Sindh Charities Registration and Regulation Act 2019 applies to charities across several registration types, including societies, trusts and companies, so check whether additional registration or reporting applies to you.

Missing these obligations can lead to show-cause notices or suspension of registration, which in turn can freeze fundraising and banking.

How a Company Registration Lawyer in Karachi Helps

• Advises on which structure fits your goals, funders and long-term plans
• Drafts the trust deed, bylaws or memorandum and articles so they are accepted first time
• Handles filings with the SECP, Registrar or Social Welfare Department
• Guides tax registration and applications for non-profit tax treatment
• Supports conversion between structures and ongoing compliance

Frequently Asked Questions