Thinking about business registration in Nepal as a foreign founder?
You are in the right place.
This guide explains the legal steps from start to finish.
You will see entity choices, approvals, documents, and timelines.
You will also learn what to do after incorporation.
The tone is practical and the steps are clear.
Use this to plan your entry and avoid common delays.
Legal options for foreign founders
FDI approvals and sector limits
Step-by-step registration workflow
Documents and drafting tips
Taxes, PAN, VAT, and post-setup compliance
Typical costs and timelines
Practical checklists and a comparison table
Companies Act, 2063 (2006). Company formation and filings.
Foreign Investment and Technology Transfer Act (FITTA), 2075 (2019). FDI approvals and protections.
Industrial Enterprises Act (latest). Industrial registration and incentives.
Inland Revenue Department (IRD). PAN, VAT, and tax filing.
Nepal Rastra Bank (NRB). Foreign currency controls and repatriation rules.
Office of the Company Registrar (OCR). Incorporation and annual filings.
Department of Industry (DoI) / Investment Board Nepal (IBN). FDI clearances and one-stop services.
Different goals call for different structures.
Here are the main options.
Best for small to medium ventures.
Limited liability for shareholders.
Flexible shareholding.
Foreign ownership usually allowed in open sectors.
Cannot offer shares to the public.
Suitable for service, trading, and technology firms.
Built for scale and public fundraising.
Stricter governance and disclosure.
Higher minimum capital and more promoters.
Suitable for large industrial or infrastructure plays.
An extension of the overseas parent.
Operates within the parent’s scope.
Subject to local taxes and filings.
Needs sectoral permission where relevant.
Can be faster if the parent is established.
For marketing, coordination, and research.
Cannot carry out revenue-generating activities.
Lower compliance than a full operating entity.
Useful for early market development.
Practical for local founders.
Not the usual route for foreign owners.
Foreigners typically invest through a company or branch.
Nepal welcomes FDI in many sectors.
Some sectors are restricted or closed.
Common open areas include manufacturing, IT, tourism, and most services.
Restricted areas often include small cottage trades and some retail segments.
Always review the current negative list before structuring.
Confirm equity caps when present.
Check for additional line-ministry permits where needed.
This is the core workflow most foreign-owned small businesses follow.
The flow assumes a Private Limited Company.
Branch and liaison offices follow similar logic with tailored documents.
Confirm your sector is open to foreign investment.
Confirm ownership caps and special permits.
Choose a unique name and reserve it on the OCR system.
Draft clear business objectives that match your sector.
Prepare a short investment plan and financials.
Submit your application to DoI or IBN, per project size.
Include ownership structure and funding routes.
Track clarifications and respond quickly.
Secure the approval letter before incorporation.
Draft the Memorandum of Association (MOA) and Articles of Association (AOA).
Align objects, capital, share classes, and director powers.
Prepare shareholder and board resolutions.
Appoint a local authorized representative by Power of Attorney.
Passports or national IDs of all promoters and directors.
Recent photographs where required.
Lease agreement or proof of registered office.
If using a virtual office, confirm regulatory acceptance.
Board resolution of the foreign parent (for branches).
Parent’s certificate of incorporation and charter (for branches).
Apostille or consular legalization for foreign documents.
Complete the OCR e-forms on the portal.
Attach MOA, AOA, IDs, photos, and FDI approval letter.
Attach address proof and the capital details.
Pay government fees as per authorized capital brackets.
Respond to OCR queries or observations.
Receive the Certificate of Incorporation.
Apply for PAN with the IRD.
Assess your need for VAT registration.
VAT registration is compulsory above set turnover thresholds.
Add e-invoicing or point of sale tools if relevant.
Set up tax accounting and retention systems.
Choose a bank familiar with FDI transactions.
Open a current account after incorporation.
Fund the capital through NRB-compliant banking channels.
Maintain copies of swift messages and FDI evidence.
Register for a municipal trade license where required.
Check for line-ministry or environmental approvals.
Apply for industry registration for manufacturing units.
Complete labor, social security, and workplace registrations.
Appoint a statutory auditor within the set timeline.
Establish bookkeeping and payroll processes.
Set an internal compliance calendar.
Schedule annual general meetings as required.
Prepare for annual OCR and IRD filings.
Validate sector openness and equity caps.
Reserve your company name on OCR.
Prepare the FDI application, if applicable.
Draft MOA, AOA, and board resolutions.
Legalize foreign documents by apostille or consulate.
Collect IDs, photos, and address documents.
File the OCR incorporation package.
Obtain the Certificate of Incorporation.
Register for PAN, and then VAT if required.
Open corporate bank accounts and fund capital.
Secure municipal and line-ministry licenses.
Appoint the auditor and lock your compliance calendar.
MOA and AOA, signed and dated
Passports or IDs of shareholders and directors
Two recent photographs of each promoter
FDI approval letter from DoI or IBN
Board resolutions and Power of Attorney
Lease agreement or proof of registered address
Capital deposit proof or banker’s confirmation
Parent company charter set for branches
Apostilled or legalized foreign papers
Government fee and stamp duty receipts
Tip: Keep spellings and addresses consistent across all files.
Minor mismatches trigger queries and delay approvals.
| Option | What it is | When to use | Revenue in Nepal | Setup speed | Compliance load |
|---|---|---|---|---|---|
| Private Limited Company | New Nepal entity with limited liability | Most operating businesses | Yes | Moderate | Moderate |
| Public Limited Company | Larger entity with public offering option | Scale and fundraising plans | Yes | Slower | High |
| Branch Office | Extension of foreign parent | Operate under parent’s scope | Yes | Moderate | Moderate–High |
| Liaison Office | Non-commercial representative office | Research and coordination | No | Moderate | Low |
| Partnership / Sole Proprietor | Unincorporated local forms | Local promoters only | Yes | Fast | Low–Moderate |
Government fees. Based on authorized capital slabs.
Professional fees. Drafting, translations, filings, and liaison.
Translations and legalization. Apostille and consular costs.
Banking and audit. Account setup and yearly audit fees.
Licenses. Municipal and line-ministry permits.
Typical timeline: Four to eight weeks is common.
FDI approvals can add time.
Well-prepared files move faster.
On-ground follow-up reduces back-and-forth.
Corporate tax. Standard rates apply by law.
PAN and VAT. Register and keep certificates current.
Withholding taxes. Apply rates on eligible payments.
Audit. Conduct annual audits within legal deadlines.
Returns. File with OCR and IRD on time.
Payroll. Register employees and manage social security.
Repatriation. Route profits through NRB-compliant channels.
Transfer pricing. Document related-party transactions.
Tip: Create a monthly close routine.
Reconcile bank, VAT, and withholding on a calendar.
Late filings invite penalties and business risk.
Use a bilingual company secretary service.
Validate sector permissions before signing leases.
Keep a document tracker with version control.
Perform KYC on local partners and landlords.
Maintain a board resolution library for key actions.
Keep FDI channel documents for future repatriation.
Pre-agree accounting policies with your auditor.
Build a renewal and filing dashboard.
Choose a branch if you must operate under the parent’s name.
This helps where brand continuity matters.
It also works if the parent must own assets directly.
Choose a liaison if you need a light presence.
Research, sourcing, and partner engagement fit well.
Upgrade to a company when revenue begins.
Nepal supports investor and work visas.
Investment size influences visa tenure.
Company registration and FDI approvals come first.
Maintain clean tax and labor compliance.
That improves visa and renewal outcomes.
Bring capital through banking channels recognized by NRB.
Keep swift copies and bank certificates.
These documents prove the foreign source of funds.
They also support future dividend and capital repatriation.
Use approved instruments for loans and royalties.
Obtain NRB approval where required.
Incomplete apostille or legalization of foreign papers.
Inconsistent names or addresses across documents.
Objectives that do not match sector permissions.
Missing landlord or building approvals for the office.
Slow responses to OCR or DoI clarifications.
Build a pre-submission audit.
Have a second reviewer check everything.
This practice saves weeks.
How long does business registration take in Nepal?
Four to eight weeks is common for new companies.
FDI approvals can extend timelines.
Clear files and quick responses speed things up.
Can foreign founders own 100 percent of a Nepal company?
Yes, in many open sectors.
Check the negative list and any equity caps.
Confirm line-ministry permits where relevant.
Is there a minimum capital for a small company?
Minimums apply under company rules.
Sector policy may set higher practical thresholds.
Discuss the right amount with your advisor and bank.
Do I need VAT from day one?
Register for VAT when your turnover meets the threshold.
Many service firms register early for input claims.
Ask your accountant to confirm timing.
What filings recur each year?
Annual audit, OCR filings, and tax returns recur.
Renew municipal licenses as required.
Keep a compliance calendar and assign owners.