Trust Registration & NGO Registration Service in Karachi, Islamabad, Rawalpindi, Lahore & , Pakistan

Trust Registration & NGO Registration Service in Karachi-Islamabad, Rawalpindi, Lahore & By The Largest Legal Network of Pakistan

Trust Registration & NGO Registration are being offered by us in Karachi-Islamabad-Rawalpindi-Lahore, Pakistan. Process of NGO/Trust Registration and requirements for NGO/Trust Registration are mentioned hereunder:

Laws For the Registration of Charitable Trusts

Prior to 2020, trusts were established using the Trusts Act of 1882, which was enforced in Pakistan and India. However, this law has been repealed in the year 2020 and now each province now has complete autonomy over trust registration and other related matters. Now each provice and Islamabad Capital Territory have their respective laws, which are as under:

Requirements For Registration of a Charitable Trust

For the establishment of a charitable trust, three prerequisites must be fulfilled: the creator, trustee, and beneficiary. Failure may occur if the trust’s objectives are not clearly defined, causing uncertainty. Public charity trusts serve the greater good or a specific portion of society. While public law governs these trusts, they differ little from private trusts. Unlike private trusts, though, charitable trusts endure as long as their charitable purpose remains, irrespective of their specific aims.

Conditions of a Trust

To establish public trust, the following criteria are essential:

Trust property must exist, whether in cash or capital assets (land or buildings).
Charity or social benefit must be the objective of the trust

Therefore, in order to be valid, a trust must satisfy these conditions or ‘certainties.’ However, this is not the case for public charitable trusts. In charitable trusts, as in private trusts, certainty as to the intention to declare a binding trust and the certainty as to the assets to be bound by the trust are strictly required. While a private trust would fail for lack of clarity if the beneficiaries are not clearly specified, a public charitable trust could be sustained even if the beneficiaries are not specified, provided the trust has a general intention of charity.

It is possible to create a trust for any lawful purpose, which may be revoked at any time. Private acts of public charity are covered by the Trust Act, which gives the creators of the trust great flexibility in how they operate. All areas of Pakistan are covered by the Trust Act and any group can benefit from it.

Advantages of Charitable Trusts

Charitable trusts play a vital role in addressing social and humanitarian issues in Pakistan. These trusts, established for philanthropic purposes, offer a range of advantages that contribute to the betterment of society.

Promoting Social Welfare:

Under the umbrella of charitable trusts, various initiatives are undertaken to promote social welfare in Pakistan. These trusts engage in activities such as providing healthcare services, education, poverty alleviation, disaster relief, and women empowerment. A charitable trust’s focus on these critical areas can greatly improve the well-being of underprivileged communities and society as a whole.

Tax Benefits:

One of the notable advantages of charitable trusts in Pakistan is the tax benefits they offer to donors and contributors. The government provides tax incentives to individuals and corporations who make donations to registered charitable trusts. These tax exemptions not only encourage philanthropy but also enable charitable trusts to receive substantial financial support, which further fuels their social impact initiatives.

Trustworthy and Transparent Mechanisms:

Charitable trusts in Pakistan are required to adhere to strict regulatory frameworks, ensuring transparency and accountability in their operations. They are subject to regular audits and are obligated to maintain accurate financial records. Such mechanisms inspire confidence among donors, who can be assured that their contributions are being utilized effectively for the intended charitable purposes.

Collaborative Approach:

Charitable trusts often collaborate with government agencies, non-profit organizations, and other stakeholders to address societal challenges collectively. This collaborative approach allows for the pooling of resources, knowledge, and expertise, leading to more impactful and sustainable initiatives. By working in partnership, charitable trusts can leverage their influence and make a substantial difference in areas that require urgent attention.

Long-Term Sustainability:

Charitable trusts are designed to ensure the long-term sustainability of philanthropic efforts. Unlike individual donations or short-term projects, these trusts have a dedicated structure and governance that enables them to continue their charitable activities even after the initial founders or donors are no longer involved. This longevity ensures that the impact of charitable trusts extends beyond immediate interventions, creating lasting positive change in communities.

Charitable Trusts Serve as Catalysts for Social Development

Charitable trusts in Pakistan serve as catalysts for social development and have numerous advantages for both society and donors. Through their focus on social welfare, provision of tax benefits, trustworthy mechanisms, collaborative approach, and long-term sustainability, these trusts have the potential to address critical issues and transform lives. By supporting and encouraging the growth of charitable trusts, Pakistan can foster a culture of philanthropy and make significant strides towards a more equitable and prosperous society.

Elements of the Trust:

There are the following elements of a trust:

Author of the trust:

The “author of the trust” is the one who reposes or declares the trust:

Trustee:

An individual who accepts the confidence is called a “trustee”:

Beneficiary

The person who benefits from the confidence is called the “beneficiary”:

Trust Property or Trust Money

“Trust-property” or “trust-money” is the subject matter of the trust

Beneficial Interest

The beneficiary’s “beneficial interest” is his legal claim against the trustee as owner of the trust-property

Instrument of the Trust

An instrument declaring a trust is referred to as an “instrument of trust”:

Creation of The Trusts

Lawful purpose

Any lawful purpose may be used to create trust. The purpose of the trust has to be lawful unless it is

Forbidden by law,
Of such a nature that, if permitted, it would defeat the provisions of any law,
Fraudulent,
Involves or implies injury to the person or property of another,
The Court regards it as immoral or opposed to public policy.

Trusts with unlawful purposes are void.

It is considered void when a trust is created for two purposes, one of which is lawful, the other unlawful, and the two cannot be separated.

Trust of immovable property

A trust relating to movable property cannot be valid unless it is declared by a non-testamentary instrument in writing signed by the author or trustee and registered, or by a will.

Trust of movable property

A trust over movable property is only valid if declared as aforesaid, or if the property is transferred to the trustee.

Trust Deed

The author of a trust creates a trust if, by any words or acts, he or she indicates with reasonable certainty:

(a) an intention on his part to create thereby a trust,

(b) the purpose of the trust,

(d) the trust-property, and (unless the trust is declared by will or the author of the trust is himself to be the trustee) transfers the trust-property to the trustee.

Who can create trusts?

A trust may be created

(a) By every person competent to contract, and

(b) With the permission of a principal Civil Court of original jurisdiction, by or on behalf of a minor;

Subject of trust

The Subject-matter of a trust must be property transferable to the beneficiary.

Who may be the beneficiary?

Beneficiaries may be anyone who is capable of holding property.

Who may be a trustee?

Trustees maybe anyone who is able to hold property. However, if the trust involves discretion, the trustee must be competent to contract to execute it. Trusts are not obligated to be accepted.

Trustee to execute the trust

The trustee is bound by the purposes of the trust and by the directions given by the author at the time of its creation, except as modified by the consent of all the beneficiaries. For the purposes of this section, where the beneficiary is incompetent to contract, his consent may be granted by a principal Civil Court of original jurisdiction. Note that nothing in this section requires a trustee to obey any direction when to do so would be impracticable, illegal, or manifestly harmful to beneficiaries.

Declaration of Trust

The author can also create a trust in which they will hold the property as trustees, but not as owners, thus eliminating the need for a property transfer. In such a situation, the declaration of trust must be by the owner, and he alone should be the trustee. Such a declaration would, however, need to be registered under the Registration Act.

Types of Trust

Trusts can be of two types:

Private
Public.

A private trust benefits an individual or group of individuals, their descendants, or any legal person who is capable of holding property. Public trust is one whose purpose is to benefit the public or any section of the public.

Process of Creation of Trust in Pakistan

There are two ways to create a trust for immovable property. The first case involved a testamentary instrument; the second was non-testamentary. A trust relating to an immovable property cannot be created orally; it must be created through a duly registered document. A trust of movable property can be created either with a document or by delivering the property to the trustee with any necessary oral instructions. By giving directions in writing, it would constitute a trust by a non-testamentary document that may or may not be registered.

Dissolution under the Trusts Act:

Trusts are extinguished if:

The purpose for which it was created has been achieved;
This becomes unlawful;
When the goal cannot be achieved; or
The trust is revoked

DOCUMENTS REQUIRED FOR TRUST REGISTRATION

Following are the required documents for the registration of a trust.

MEMORANDUM OF ASSOCIATION: Contains Name of the Trust, Address of the Trust’s main office, Objectives of the Trust, and Authors of the Trust Schedule
TRUST DEED (on 2000/ Rupees Stamp Paper
AFFIDAVIT
Attested copies of CNICs or Passport
PROOF OF THE REGISTERED OFFICE ADDRESS
N.O.C / RENTAL AGREEMENT
AFFIDAVIT ON SCHEDULE-III (NO LEGAL PROCEEDING/ NO CRIMINAL RECORD)
Bank Challan of Rs.10,500/- (rupees Ten Thousand Five Hundred only).
Any other documents as Assistant Director or Director may require.
Picture of Trustee or Author along with Sign and Thumb Impression must be fixed in the current deed and green paper shall be used for the registration of the deed.
Authority Letter of a Person ( who is responsible for the registration matter of Trust)
Pro forma for Trust

NGO Registration in Pakistan

The Vibrant NGO Sector in Pakistan

The non-profit sector in Pakistan is diverse and vibrant, experiencing significant growth as the government recognizes the value of non-governmental organizations (NGOs) in development and improving citizens’ lives. This sector includes traditional welfare organizations, modern development-oriented NGOs, and informal networks of community-based organizations. In recent years, the term “NGO” has become widely used in Pakistan, referring to any organization working for society’s welfare, although there is no legal definition of the term in Pakistani law. These organizations often take the form of societies or voluntary welfare agencies, with many remaining informal and unregistered.

The NGO Sector in Pakistan

Scope and Activities

A 2002 study by Johns Hopkins University estimated 45,000 active non-profit organizations in Pakistan, with 46% involved in religious education. The sector’s combined income was estimated at 16,400 million rupees. Voluntary and welfare organizations vary in size, from small neighborhood and village committees to large organizations providing education, health, and social services at the national level. Since the 1980s and 1990s, rights-based organizations have become more prominent, complementing traditional social services.

Independent Analysis of the NGO Sector in Pakistan

The Pakistan Centre for Philanthropy has published numerous papers on the non-profit sector in Pakistan, providing valuable insights into its dynamics and challenges.

International Programs and NGO Development in Pakistan

Strategic Initiatives

The International Program has been active in Pakistan since 2003, formalizing an action plan with the government in 2006. Key achievements include developing a national database of NGOs, creating a code of conduct for NGO regulators, and delivering comprehensive training for over 1500 NGO regulation staff across Pakistan. Plans include more detailed training in regulatory issues and producing guidance leaflets to assist NGOs.

By understanding the legal and regulatory framework, benefits, and reporting requirements for NGOs in Pakistan, organizations can navigate the complexities of NGO registration and contribute effectively to the country’s development.

Legal Framework for NGO Registration in Pakistan

Ensuring Free Association

The right of free association is guaranteed by the Pakistan Constitution, albeit with certain limitations. The legal framework governing NGO registration in Pakistan is complex, with several laws under which an NGO may be registered. The most significant of these laws include:

Voluntary Social Welfare Agencies Registration and Control Ordinance 1961: This ordinance defines permissible purposes within the social welfare field and mandates registration for organizations seeking government funding.
Societies Registration Act, 1860: Applicable to charitable societies with a wide range of public benefit purposes.
Cooperative Society Act, 1925
Companies Ordinance, 1984 (Section 42): Applies to not-for-profit companies formed to promote ‘useful objects.’
Trust Act, 1882: Applies to private trusts with a wide range of purposes.
Income Tax Ordinance, 2001: Sets out the tax exemptions which NGOs are eligible for.

While registration is generally not compulsory, foreign NGOs and those receiving government funding must register with the Economic Affairs Division and Central Board of Revenue, respectively. Consequently, many NGOs in Pakistan choose whether or not to register and select the appropriate regime. A majority (65.4%) of NGOs are registered under the Societies Registration Act, while around 20% remain unregistered.

Regulatory Framework for NGOs in Pakistan

Federal and Provincial Roles

Pakistan’s federal system of government involves states in policy-making processes, with certain powers regarding NGOs devolved to the state level. The Ministry of Social Welfare and Special Education, along with the Provincial Social Welfare Departments, is responsible for registering and monitoring organizations under the Voluntary Social Welfare Agencies (Registration and Control) Ordinance 1961. The District Offices of the Industry Department handle registration under the Societies Registration Act 1860.

Not-for-profit companies must obtain a license from the Securities and Exchange Commission (SEC), meeting specific conditions such as prohibitions on payments to members and trading. Following this, they apply for a Certificate of Incorporation from one of eight Company Registration Offices. International NGOs must register and agree on a Memorandum of Understanding (MoU) with the Economic Affairs Division, although there is no legal basis for this requirement.

Benefits of NGO Registration in Pakistan

Tax Exemptions

NGOs, including international ones, may be eligible for tax exemptions. Charities are potentially exempt from tax on most forms of income if funds are applied solely in furtherance of their objectives. However, such exemptions are not automatically granted and must be applied for directly to the Ministry of Finance. No exemption is granted for income from property, capital gains, and business activities. To be eligible for these benefits, a charity must register with the Central Board of Revenue, with approval granted for three years.

Reporting Requirements for NGOs in Pakistan

Annual Reporting

Organizations registered under the Voluntary Social Welfare Agencies (Registration and Control) Ordinance 1961 must maintain accounts and submit annual reports and audit reports to District Officers, detailing management, activities, and plans. These accounts and reports are publicly available. Registered societies must submit annual membership lists, while not-for-profit companies must submit annual returns, audited accounts, and other documents for examination.

International NGOs must explain their plans to the Economic Affairs Division (EAD), which coordinates with relevant ministries to ensure alignment with national development frameworks. NGOs benefiting from tax exemptions must submit annual audited accounts, a list of donors and beneficiaries, and other financial information to the Central Board of Revenue.

Government NGO Policy in Pakistan

Training and Development

The Ministry of Social Welfare and Special Education in Sindh operates a training institute dedicated to NGOs registered under the Voluntary Social Welfare Agencies Registration Ordinance 1961. This institute conducts training sessions in Karachi and mobile training sessions across Sindh.

Do you want to register a Trust/NGO/NPO? Taxocrate can assist you!

Are you looking for experienced consultants to discuss the process of Trust/NGO/NPO registration? Taxocrate can help you by providing the full legal consultation regarding these matters. Not only that, if you want to register your Company/Trademark, we will be the best choice. Give us a call today and we will guide you with our expert advice and unmatched consultancy services.

Contact Us Now

You can contact us on any of the following platforms to get an instant support.

Contact Us

Popular Service

Provincial Tax Authorities

Misc. Services

Recent Article

Book Appointment

Disclaimer: All information is provided on this portal solely for informational purposes. This portal is not affiliated with the Government website. Please note that this disclaimer also applies to our website, and we may refer to it as ‘us’, ‘we’, ‘our’ or ‘website’. The information on the website has been gathered from various government and non-government sources. We disclaim any liability for errors, injuries, losses, or damages arising from the use of this information. We also disclaim any liability for the availability and authenticity of this information. Our services consist of filling out forms, providing legal advice, and assisting our clients. The departmental processing of the registration forms is not our responsibility. You will have to use a service fee for professionally preparing your application, submitting it to the relevant authorities, and coordinating your application process. You will have to pay any Government fees.