Bookkeeping · PakistanBooks kept the way the Companies Act, the FBR and your auditor will expect to find them.
We record your sales, purchases, payroll and bank transactions every month and track the withholding tax and sales tax that run through them, so tax returns and annual accounts start from records you can defend.
Accounting
At a glance
- Authorities
- Federal Board of Revenue (FBR) · Securities and Exchange Commission of Pakistan (SECP) · Provincial revenue authorities (PRA, SRB, KPRA, BRA)
- Forms & references
- Sales tax return (Annex-A / Annex-C)Withholding statements (section 165)CPR / PSID
- Company law
- Companies Act 2017, section 220: books kept for at least 10 financial years
- Tax records
- Generally 6 years under the Income Tax Ordinance and Sales Tax Act
- Financial year
- Usually 1 July to 30 June, matching the normal tax year
- Software
- QuickBooks, Xero, Zoho Books or your existing ERP
Overview
What it is, and why it matters.
Every company in Pakistan must keep books of account at its registered office that give a true and fair view of its affairs, under section 220 of the Companies Act 2017. Those books, with the vouchers supporting each entry, must be kept in good order for at least the ten preceding financial years.
Tax law adds its own layer. The Income Tax Ordinance 2001 and the Sales Tax Act 1990 each require records to be kept for six years after the end of the relevant tax year or period, and longer if proceedings are pending. For companies, the ten-year company law rule is usually the one to plan around.
Much of the work in Pakistani bookkeeping is tax tracking. Tax you deduct from suppliers, staff and landlords must be deposited through a CPR and reported in withholding statements; tax deducted from you by customers and banks needs certificates before you can claim it; and sales tax input is only claimable on properly paid, matched invoices. We keep all of this in the books as it happens.
Who needs it
Who typically needs it.
- 01
Private limited companies
SMEs registered with SECP that need books ready for audit, the annual income tax return and withholding statements.
- 02
IT and software exporters
Software houses and agencies receiving export proceeds from US, UK and other clients through Pakistani banks.
- 03
Sales tax registered businesses
Manufacturers, distributors and service providers filing monthly federal or provincial sales tax returns.
- 04
AOPs and sole proprietors
Partnerships and individual business owners who need organised records for their tax returns and for answering FBR notices.
- 05
Pakistani operations of foreign groups
Subsidiaries and branches of US, UK or other groups that report monthly to a parent and are audited locally.
When you need it
The moments that usually trigger it.
- You’ve just incorporated a company with SECP and need a chart of accounts before the first transactions.
- You’ve registered for sales tax and your first monthly return is due.
- You’re paying rent, contractors or salaries and need to deduct and deposit withholding tax correctly.
- Your auditor has asked for a general ledger, fixed asset register and supporting vouchers.
- An FBR notice asks you to explain figures in a return.
- Your records are in spreadsheets or a manual cash book and the business has outgrown them.
Scope
Exactly what we handle.
Our engagement letter lists these specifically, so you know what is included before any work begins.
- 01
Chart of accounts set up in QuickBooks, Xero, Zoho Books or your existing ERP, structured around Pakistani tax returns and your reporting framework.
- 02
Monthly recording of sales, purchases, expenses, payroll and bank transactions, with vouchers referenced.
- 03
A withholding tax register: tax deducted from payments you make, the CPRs used to deposit it, and data for withholding statements.
- 04
A register of tax deducted from you by customers, banks and others, with certificates tracked so credit isn’t lost.
- 05
Sales tax input and output records by invoice, matched to your federal or provincial return.
- 06
A fixed asset register with accounting and tax depreciation.
- 07
Payroll journals, including income tax deducted from salaries and EOBI or provincial social security contributions where they apply.
- 08
Monthly management reports and a list of open queries.
The process
How it runs, step by step.
Timings depend on the authority and on how quickly documents come together. We tell you what’s typical for your case at the start.
Start with a conversationUnderstand the business
We review your legal form (company, AOP or sole proprietor), tax registrations, sales tax status, bank accounts and current records.
Build the ledger and tax registers
We build or tidy the chart of accounts, enter opening balances from your last audited accounts or tax return, and set up the tax registers.
Monthly posting
We post transactions, reference vouchers, and record withholding tax and sales tax as they arise.
Monthly tax tie-out
Before sales tax and withholding filings, we reconcile the registers to the books and the bank, and flag supplier invoices that may not be claimable.
Monthly reports and audit handover
You receive monthly reports. At the year end we prepare a trial balance and schedules for your annual accounts and your auditors.
What we’ll need
The information to have ready.
A typical checklist. After the first conversation we send a version specific to your situation, so you don’t gather anything you don’t need.
Registration details
- NTN, and STRN if registered for sales tax
- SECP certificate of incorporation and company details, if a company
- Last audited accounts or last income tax return
Monthly documents
- Bank statements for every business account
- Sales and purchase invoices
- Payroll sheets
- CPRs for tax you have deposited
- Withholding certificates received from customers and banks
Access
- Access to your accounting software or ERP
- Access to IRIS, or copies of filed returns and statements
Please don’t email passports or bank statements. Once we’ve spoken, you’ll get access to a secure upload.
Common mistakes
Where this usually goes wrong.
The problems we are most often asked to fix, and what they tend to cost.
- Mistake 01
Paying suppliers in cash above the limit
Under section 73 of the Sales Tax Act 1990, input tax can be disallowed if payments above Rs 50,000 to a supplier in a tax period aren’t made through the banking channel from your declared business account. Cash payments also make expenses harder to support for income tax.
- Mistake 02
Deducting withholding tax but not depositing it
Tax deducted from suppliers or staff is held for the government. Late deposit brings default surcharge and penalties, and the related expense can be disallowed.
- Mistake 03
Not tracking tax deducted from you
Tax deducted by customers or banks only helps you if you can claim it. Without certificates and a register matched to your return, credit can be lost.
- Mistake 04
Claiming input tax on unmatched invoices
If a supplier hasn’t declared the sale in its own return, or isn’t an active taxpayer, your input claim may be rejected. Checking suppliers each month avoids surprises at the return.
Worth knowing
The limits, stated upfront.
We are not your statutory auditors. Where an audit is required, it must be carried out by an independent firm of chartered accountants.
Filing sales tax returns, withholding statements and income tax returns is handled through our tax services unless included in your engagement.
We rely on the documents you provide, and missing invoices or bank statements limit what we can support.
Tax rates and withholding rules change with each Finance Act, and we apply the rules in force for each period.
Questions
Bookkeeping: frequently asked.
If yours isn’t here, ask us directly. We’ll answer in plain terms.
Ask a questionHow long must a company in Pakistan keep its books of account?
At least ten financial years, with the vouchers supporting each entry, under section 220 of the Companies Act 2017. Income tax and sales tax law require six years, or longer if proceedings are pending, so companies usually plan around the ten-year rule.
Which accounting software do Pakistani businesses use?
QuickBooks, Xero and Zoho Books are common among smaller businesses, while many larger companies run Odoo or locally developed ERPs. We can work in most of these; what matters more is a chart of accounts that fits Pakistani tax returns.
What is a withholding tax register, and why do I need one?
It records the tax you deduct from payments such as rent, services, contracts and salaries, and the CPRs used to deposit it. It supports your withholding statements and protects the related expenses from being disallowed.
Can you keep books for a business that isn’t a company?
Yes. AOPs and sole proprietors aren’t bound by the Companies Act rules, but they still need records to support their income tax returns and, if registered, their sales tax returns.
Do I need to be registered for sales tax to use your bookkeeping service?
No. We record purchases and sales properly either way, and we will tell you if your activities suggest federal or provincial sales tax registration may be required.
Our clients are in the US and UK. How should export receipts be recorded?
As export revenue at the rupee amount your bank actually credited, with any difference from the invoice recorded as an exchange difference or bank charge. Tax the bank deducts at source is recorded separately so it can be treated correctly in your return, and the bank’s proceeds realisation certificate or credit advice is kept with each receipt.
Related
Often needed alongside this.
The equivalent in our other countries
Speak with a consultant
Talk to us about bookkeeping.
Pick the closest match and we’ll take it from there. You’ll get a written scope and fee before any work begins.
Or use our three-step guide, or email hello@fiscorra.com