NGO Registration in Pakistan

Complete Details of NGO Registration Pakistan are as under:

NGO Registration Pakistan or Non for Profit Sector or commonly known as NGO sector is backbone of Pakistan and Government in recent times has acknowledged its importance. There are different types of Non for Profit organizations such as welfare associations, Education improvement initiatives and rural development programs etc. In General terms NGO is any organization that undertakes an activity for welfare of the society and primary purpose of which is not to earn profit for its promoters.

Registration of Not for Profit Organization in Pakistan

• The legal framework governing NGOs is complex, and there are several laws under which an NGO may be registered. The most significant of these are:
• There are several laws Governing the formation for Not for profit organization in Pakistan. Some of the significant laws are mentioned below as reference:
• Social welfare agencies are registered under Social Welfare Agencies Registration and Control Ordinance, 1961. All the permissible activities that social welfare organizations can undertake in Pakistan are mentioned in detail in this ordinance. An important point worth mentioning here is that if the companies intend to receive Government Funding registration under this ordinance is mandatory.
• Charitable Societies that intend to undertake charitable activities in Pakistan are required to register under Societies Registration Act of 1860 and Cooperative society Act of 1925.
• One of the most common form of Not for profit organizations registration is registration under Companies Ordinance, 1984. Section 42 of the companies Ordinance 1984 lay down the procedure for registration of Non for profit organization under Companies Ordinance, 1984

NGO Pakistan – Registration

Income Tax Implication for Non for Profit Organizations Registered in Pakistan

• The applicable tax ordinance in Pakistan is Income Tax Ordinance, 2001 and it has laid down several exemptions for Not for Profit Organizations. Income Tax Ordinance, 2001 does not require every Not for Profit Organization to register however there are certain exceptions that include Foreign NGOs or those that receive Government funding.

NGO Registration in Pakistan – Provisions of Companies Ordinance, 1984

NGO under companies ordinance 1984 are referred as Association Not for Profit. Section 42 of the companies ordinance, 1984 deals with Association not for profits. Section 42 is explained as under:

If the Securities and Exchange Commission of Pakistan is satisfied with an association which has been formed or is capable of being formed as limited company that it meets the conditions specified by Companies Ordinance, 1984, the Commission may grant license and direct that the association be registered as limited company without addition of word “Limited”, “(Private) Limited” or “Guarantee Limited”, as the case may be, to its name and the Association may be registered accordingly.

Conditions Specified by Companies Ordinance, 1984 for Association not for Profits or NGO Registration Pakistan:

• Association should be formed for providing commerce art, science, religion, sports, social services, charity or any other useful object.
• Association applies or intends to apply its profits, if any or other income in promoting its objects; and
• Association prohibits the payment of Dividends to its members.

The conditions and regulation in this regard issued or imposed by the Commission shall be binding on the association and may be inserted in Memorandum and Articles of Association or one of those on the direction of commission.

The association shall enjoy all privileges of a Limited Company subject to all its obligations except using the word “Limited”, “(Private) Limited” or “Guarantee Limited” as the case may be.

The license may be revoked by Securities and Exchange Commission of Pakistan and upon its revocation, the registrar shall enter the word “Limited”, “Private Limited”, “(Private) Limited”, or “Guarantee Limited:, as the case may be, at the end of the name of Association and the Association will cease to to enjoy all the exemptions and privileges granted by Securities and Exchange Commission of Pakistan.

Before the revocation of the license, the Commission shall give a notice in writing to the Association  of its intention and the association shall be afford the opportunity of submitting a representation in this regard.

The Companies Rules 1985 states that the above privileges are available to public limited companies only and no private limited company can be granted license under section 42.

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