Why Pakistani founders form a US LLC or UK Ltd
The main reason is payments. Stripe's global availability page lists more than 45 countries, and Pakistan is not one of them. A business based in Pakistan cannot open a Stripe account for a Pakistani entity. A company formed in the United States or the United Kingdom can apply to Stripe in that country, because Stripe lists both.
Freelancers, Shopify and Amazon sellers and SaaS founders all hit the same wall: the payment tools their customers expect are not open to Pakistan-based accounts.
A foreign company is a tool for this problem, not a shortcut around the rules. Each provider still reviews who owns and runs the company, where you live, and what you sell.
What payment providers say about Pakistan
Stripe
Stripe does not support Pakistan-based accounts. For a US company, Stripe says registered businesses must be registered in the US, even if you operate in another country, and it verifies the legal name, entity type, EIN and a physical business address (no PO boxes). Owners and representatives who are not US persons give their local non-US tax ID and supporting documents, which for you means your Pakistani tax details. A US LLC owned from Pakistan may be eligible, but Stripe decides each case and can refuse or close accounts.
PayPal
We could not confirm on paypal.com that a Pakistan-registered PayPal account can receive payments. PayPal's help center, including its Pakistan version, carries an article that says members in some countries and regions may only use PayPal to send payments and not receive payments. Check the features for Pakistan on PayPal's own site before you plan around it. Never buy or rent a PayPal account opened in someone else's name: it breaks PayPal's terms and puts your money at risk.
Payoneer
Payoneer serves Pakistan. Its Pakistan guide says you can get paid like a local in the US, UK, EU and other regions and withdraw funds to a Pakistani bank, and it has announced withdrawal partnerships with Meezan Bank and HBL. Many freelancers use Payoneer as individuals without any foreign company.
Wise
Wise does not open personal accounts for Pakistan residents. Its own Pakistan article says residents of Pakistan cannot directly sign up for Wise accounts, and Pakistan is not on its list of countries where you can hold money with Wise. Your clients can still use Wise to send money to your Pakistani bank account. Whether Wise will onboard a US or UK company owned by a Pakistan resident is decided in Wise's own review, and we cannot confirm it in advance.
Mercury
Mercury lists Pakistan as a prohibited country. Pakistan appears on Mercury's prohibited countries page, so do not plan your US LLC around a Mercury account.
No company, agent or bundle can promise that Stripe, Mercury, Wise, Payoneer or any bank will accept you. Anyone who promises a "verified" account for you is asking you to break the provider's terms. Our payment account help prepares your documents and application, and the provider makes the decision.
The US LLC route from Pakistan
A US LLC can be owned 100% by a Pakistani citizen living in Pakistan, and no US visit is needed. Our US LLC for non-residents guide covers the general rules; here is how they apply to you.
Choose a state
Most Pakistani founders choose Wyoming, New Mexico or Delaware because they do not live in any state and want low fees and simple upkeep.
- Wyoming: $100 to file Articles of Organization, plus a 2.4% card fee online ($102.40). The annual report is due on the first day of your anniversary month, at a minimum of $60. See our Wyoming LLC page.
- New Mexico: $50 to file under the LLC Act fee section, which lists no annual report fee for LLCs. See our New Mexico LLC page.
- Delaware: $110 to form, plus an annual LLC tax of $400 due each 1 June, rising from $300 for the 2026 tax year. See our Delaware LLC page.
Every state requires a registered agent with a physical address in that state. The full side by side comparison is on Wyoming vs Delaware vs New Mexico LLC, and our LLC state fee comparison tool totals the costs.
Get an EIN by fax or phone
You cannot use the IRS online EIN form from Pakistan. The IRS online service needs an SSN or ITIN and a US principal place of business, so non-residents apply by phone, fax or mail. The Form SS-4 instructions give the international fax number 304-707-9471 and the international phone line 267-941-1099 (not toll free), open 6:00 a.m. to 11:00 p.m. Eastern time, Monday to Friday, which is afternoon and night in Pakistan. The EIN is free from the IRS. If you leave the SSN or ITIN box empty because you are not eligible for one, the instructions say to enter "foreign" or N/A. Our EIN application service prepares and files the SS-4 for you.
You do not need an ITIN to form an LLC or to get an EIN. An ITIN matters only if you have a US tax return or treaty claim that needs one; see our ITIN application page.
File Form 5472 every year
A single-member LLC wholly owned by a foreign person files Form 5472 with a pro forma Form 1120 every year, even with no income. For a calendar year it is due 15 April, or 15 October with a Form 7004 extension. It cannot be e-filed by a foreign-owned disregarded entity: it goes by fax or mail. The penalty for not filing is $25,000 per form. Money you put into the LLC, including the formation fees you pay personally, counts as a reportable transaction. The details are in our Form 5472 guide, and our Form 5472 filing service prepares and faxes it.
BOI reports no longer apply to US LLCs, including those owned from Pakistan; see BOI report 2026. Whether you personally owe US income tax depends on whether your LLC has a US trade or business, which is a question for a US tax professional.
The UK Ltd route from Pakistan
A Pakistani citizen living in Pakistan can be the director and sole shareholder of a UK private limited company. GOV.UK says directors do not need to live in the UK, but the company must have a UK registered office.
Identity verification with a Pakistani passport
Every new director must verify their identity with Companies House before the company can be formed. The free route is GOV.UK One Login, which accepts a biometric passport from any country. If your Pakistani passport has a chip, you can verify in the GOV.UK ID Check app, and you receive a Companies House personal code to give in the incorporation application. If your passport is not biometric, the other GOV.UK routes need UK bank details and a National Insurance number or a visit to a UK Post Office, which rarely suit someone living in Pakistan. In that case renewing to a chip passport or using an Authorised Corporate Service Provider (ACSP) are the remaining options. You do the One Login check yourself; we do not verify on your behalf. Our Companies House identity verification guide walks through it.
Registered office and HMRC post
The registered office must be a physical UK address where post comes to the attention of someone acting for the company. PO boxes are not allowed. HMRC posts the company's tax reference (UTR) and Corporation Tax activation code to that address, so you need a provider who scans your mail. See our registered office address service.
Costs and yearly filings
Online incorporation costs £100 at Companies House, and each yearly confirmation statement costs £50 online. You also file annual accounts and a Company Tax Return (CT600) within 12 months of the end of each accounting period, using commercial software now that HMRC's free filing service closed on 31 March 2026. If you sell to UK consumers, VAT can apply from your first sale for a company run from abroad; see our VAT threshold guide. The full process is in our UK company formation for non-residents page.
Banking realities for Pakistani owners
Expect fewer options than founders from most other countries. Mercury lists Pakistan as prohibited. Wise does not open personal accounts for Pakistan residents. For UK companies, Tide asks for a valid UK mobile number and a device registered to a UK app store, and Revolut Business publishes a list of eligible countries of residence for UK companies that includes India but not Pakistan.
Plan for this before you pay any formation fee: check each provider's current eligibility page and keep a fallback such as Payoneer for receiving money. Our US LLC bank account guide covers the options in more detail.
Pakistan-side rules: SBP and FBR
Forming a company abroad does not take you outside Pakistani law. What follows is a high-level summary of official sources, not legal or tax advice. Get advice from a Pakistani tax adviser before you invest money in, or take money out of, a foreign company.
State Bank of Pakistan: investing abroad
The SBP Foreign Exchange Manual, Chapter 20 (paragraph 13) sets the terms for residents of Pakistan who make equity investment in entities abroad. The general permissions it lists for resident individuals cover small investments in listed foreign companies (up to USD 25,000 a year), employee stock plans and sweat equity. Owning and funding your own foreign company is not one of those listed general permissions, and resident companies generally need prior SBP permission, with general permissions for some IT and export-oriented companies. Talk to your bank and an adviser about how the rules apply before you send capital abroad.
State Bank of Pakistan: bringing money home
SBP rules favor money that arrives through banking channels. Since October 2023, SBP lets freelancers open an Exporters' Special Foreign Currency Account (ESFCA) alongside their rupee account, and retain 50% of export proceeds or USD 5,000 a month, whichever is higher, in that account. In April 2026 SBP said IT companies and freelancers can give a one-time declaration instead of filing Form R for each transaction. Whether payments from your own US LLC or UK Ltd count as your export proceeds, and how to document them, is a question for your bank and a Pakistani tax adviser.
FBR: tax residence
Under section 82 of the Income Tax Ordinance, 2001, you are resident in Pakistan for a tax year if you are present for 183 days or more, or for 120 days or more with 365 days or more in the four preceding years. FBR's guide says residents are taxed on both Pakistan source income and foreign source income. How the profits of a US LLC or UK Ltd are taxed in your hands, and how to show the company and any foreign accounts in your return and wealth statement, needs a Pakistani tax adviser.
Common mistakes Pakistani founders make
- Forming an LLC for Mercury and then finding Pakistan on Mercury's prohibited list.
- Using a registered agent address as the business address on Stripe or bank forms. Providers ask for a real business address.
- Skipping Form 5472 because the LLC earned nothing. The filing is still due, and the penalty is $25,000.
- Paying for a BOI report on a US LLC. It is not required.
- Buying a "verified" Stripe or PayPal account in someone else's name. Accounts get closed and balances held.
- Choosing a UK Ltd without a registered office that scans HMRC post, then missing the UTR and activation code letters.
- Ignoring SBP and FBR rules because the company is abroad.
Official costs at a glance
These are government fees only. Our service fees are on the pricing page.
| Item | Official fee | Source |
|---|---|---|
| Wyoming LLC formation | $100 ($102.40 online with card fee) | Wyoming Secretary of State |
| New Mexico LLC formation | $50 | NMSA 53-19-63 |
| Delaware LLC formation | $110 | Delaware Division of Corporations |
| Wyoming annual report | $60 minimum | Wyoming Secretary of State |
| Delaware annual LLC tax | $400 (2026 tax year, due 1 June 2027) | Delaware Division of Corporations |
| EIN | $0 | IRS |
| Form 5472 filing | $0 (penalty $25,000 if missed) | IRS |
| UK Ltd incorporation (online) | £100 | Companies House |
| Confirmation statement (online) | £50 a year | Companies House |
| Identity verification (GOV.UK One Login) | £0 | GOV.UK |
Still deciding between the two? Try the US LLC or UK Ltd quiz, then see how it works and how we protect your passport scans on our security page.
Sources
- Stripe: Global availability
- Stripe Support: Requirements for having a US Stripe account
- Stripe Support: Business representative and owner tax ID requirements for US companies
- PayPal: Why does my PayPal account have only send capabilities?
- Payoneer: Small business payment solutions in Pakistan
- Payoneer: Payoneer and Meezan Bank partnership
- Wise: Best ways to receive international payments in Pakistan
- Wise Help: Where do I need to live to hold money with Wise?
- Mercury: Prohibited countries
- Wyoming Secretary of State: Business fees
- New Mexico Statutes: Section 53-19-63, fees
- Delaware Division of Corporations: Fee schedule (August 2026)
- Delaware Division of Corporations: LLC, LP and GP tax instructions
- IRS: Get an employer identification number
- IRS: Instructions for Form SS-4
- IRS: Instructions for Form 5472
- GOV.UK: Appoint directors and a company secretary
- GOV.UK: Verify your identity for Companies House
- GOV.UK: Company address
- GOV.UK: Companies House fees
- GOV.UK: Company Tax Returns
- Tide: Can I apply from abroad?
- Revolut Business: Eligible countries of residence
- State Bank of Pakistan: Foreign Exchange Manual, Chapter 20 (Securities)
- State Bank of Pakistan: BPRD Circular No. 05 of 2023, Framework for Freelancers Accounts
- State Bank of Pakistan: SBP introduces new measures to facilitate IT exporters and freelancers (23 October 2023)
- State Bank of Pakistan: Press release, 6 April 2026
- Federal Board of Revenue: Section 82, Resident individual
- Federal Board of Revenue: Basic concepts of tax on income
Fees, deadlines and rules on this page were last checked on 27 September 2026.