It is always adventurous to start a business in Pakistan but company registration is always a dream. Some of the mistakes that can be prevented include Therefore, to avoid being trapped in such cases that could cost a lot of money, it is important to follow the following guidelines to avoid some of these mistakes below. This paper focuses on the most common issues and gives recommendations for a smooth registration process, below.
1. Incomplete Documentation
Mistake The most typical mistake, which is made at the stage of company formation, is the submission of improper or insufficient documents.
Solution The documents include the Memorandum of Association and Articles of Association, copies of the directors’ CNICs, and proof of their address. It is wise to consult a legal practitioner to assist confirm on the foregoing requirements.
2. Selecting an Unsuitable Type of Business Formation
Mistake Choosing an improper business legal status (sole trader, partnership, limited company, etc. ) results in operational and financial problems.
Solution Consider the environment in which you are operating, the amount of control that is required, as well as taxes before choosing a structure. It is always useful to consult legal advisors in order to make the right decision regarding the selection of the correct option.
3. Neglecting to Reserve a Unique Company Name
Mistake Any failure to get a unique company name will lead to the rejection of your application equally lead to extension of time.
Solution Perform a search to check if the name of the intended company is available and follows the criteria set out by SECP. To ensure there is no conflict with any other company already registered or in the process of being registered the name call can be reserved using the SECP’s online portal.
4. Ignoring Regulatory Requirements
Mistake Failure to consider and obtain the basic legal needs that are often mandatory for any business including licenses and compliance to sector norms and regulations will attract legal consequences.
Solution Understand all the rules and regulations to be followed according to the type of business being operated. One may seek professional help from a lawyer to know and observe these requirements.
5. Underestimating the Importance of a Registered Office
Mistake Having a temporary or an incorrect address as your registered address may lead to issues with delivery and receipt of official documents as well as inspections.
Solution Obtain the registered office situated with a permanent, official address. This is the address that shall be used for all kinds of communications legal and official included.
6. Failing to Appoint Competent Directors
Mistake The expertise, experience and legal requirements of the directors are valuable when hiring directors because they influence corporate governance.
Solution Choose directors who qualify legally and at the same time possess the worthy qualities and experience that can assist the company. Before that, the individuals should undergo proper background checks to meet all the necessary and sufficient criteria.
7. Overlooking Tax Registration
Mistake Also, failing to register for taxes which include Income Tax, Sales Tax, and other taxes, one can be penalized, and business operations can be affected.
Solution If necessary use the NTN and STRN issued to the company by the Federal Board of Revenue (FBR) for taxes purposes. Lawyers are also capable of helping you with issues to do with registration of taxes.
8. Not Seeking Professional Help
Mistake This is because self-registering of the students may lead to many complications and most importantly a lot of time will be consumed in the exercise.
Solution Hire the services of practicing lawyers who have a familiarity with the company’s registration process to avoid or minimize paperwork blunders.
Conclusion
It is expected that with the help of these tips avoiding these common mistakes during the process of company registration in Pakistan will be easier. This is not a problem since I am a professional legal advisor practicing in Lahore with vast experience in the registration process of the firms and I am ready to assist you. Contact us today for your business establishment legal advice and you will be on the right legal foundation.