Non-Profit Organization (NPO)

A Non-Profit Organization (NPO) is established to serve social, cultural, educational, or charitable purposes without distributing profits to its members. These organizations reinvest their revenue to achieve their objectives and are eligible for tax exemptions. NPOs in Pakistan can be registered as Societies, Trusts, or Section 42 Companies under the Companies Act, 2017.

Benefits

  • Legal Recognition:
    Gain formal legal status to operate as a recognized entity.
  • Tax Exemptions:
    Enjoy various tax benefits and incentives.
  • Fundraising Opportunities: Attract donations and grants from individuals, corporations, and government bodies.
  • Credibility and Trust:
    Establishes legitimacy with stakeholders, including donors and beneficiaries.
  • Perpetual Succession:
    Ensures continuity even if founding members change.

Required Documents

  1. CNIC copies of all members.
  2. Proof of address for the organization’s registered office.
  3. Memorandum of Association (MoA) – Outlines the organization’s objectives and activities.
  4. Articles of Association (AoA) – Defines internal governance rules.
  5. List of founding members and their roles.
  6. Affidavit declaring authenticity and non-profit nature.
  7. No Objection Certificate (NOC) from relevant authorities (if applicable).

Registration Process

  1. Select Legal Structure:
    • Society: Register under the Societies Registration Act, 1860.
    • Trust: Register under the Trusts Act, 1882.
    • Section 42 Company: Register with the Securities and Exchange Commission of Pakistan (SECP).
  2. Prepare Documents:
    • Compile all required documents according to the chosen structure.
  3. Submit Application:
    • Submit the application to the relevant authority:
      • Registrar of Societies for Societies.
      • Local Government Authority for Trusts.
      • SECP for Section 42 Companies.
  4. Verification and Inspection:
    • Authorities verify the submitted documents and may inspect the premises.
  5. Approval and Certification:
    • Upon successful verification, receive a registration certificate.

Legal Framework

  • Societies Registration Act, 1860: Governs societies’ establishment and operation.
  • Trusts Act, 1882: Regulates the creation and functioning of trusts.
  • Companies Act, 2017: Applies to Section 42 Companies.
  • Income Tax Ordinance, 2001: Offers tax exemptions to eligible NPOs.

Why Choose to Register an NPO?
Registering your non-profit organization establishes credibility, enables access to funding, and ensures compliance with legal requirements. It’s the best way to maximize impact while maintaining transparency and trust.