FAQs on How to Register a Company in Nepal (Updated 2026)

If you are exploring how to register a company in Nepal, you are not alone. Nepal has emerged as a cost-efficient, talent-rich destination for foreign companies expanding into South Asia. From IT and outsourcing to manufacturing, trading, and services, Nepal offers clear legal pathways for foreign investors.

This updated 2026 guide answers the most common and practical questions foreign companies ask before entering Nepal. It is written to save you time, reduce compliance risk, and help you decide the right structure for your business.

By the end, you will know exactly how to register a company in Nepal, what documents are required, how long it takes, and what mistakes to avoid.

Why Foreign Companies Are Registering in Nepal

Nepal’s appeal goes beyond low costs. The country has strengthened its foreign investment framework in recent years.

Key drivers include:

• Competitive labor costs with strong English proficiency

• Government-backed Foreign Direct Investment (FDI) protection

• Growing IT, BPO, fintech, and engineering sectors

• Strategic access to India and China

• Clear company registration and profit repatriation rules

According to government investment guidelines, foreign investment is permitted in most service, technology, and manufacturing sectors, subject to sectoral approvals.

Legal Framework Governing Company Registration in Nepal

Understanding the legal base improves trust and compliance.

Foreign company registration in Nepal is primarily governed by:

• Companies Act, 2006

• Foreign Investment and Technology Transfer Act (FITTA), 2019

• Industrial Enterprises Act, 2020

• Income Tax Act, 2002

• Labour Act, 2017 and Social Security Act, 2018

These laws collectively regulate incorporation, foreign ownership, taxation, employment, and profit repatriation.

Types of Business Entities Available to Foreign Companies

Before learning how to register a company in Nepal, you must select the correct legal structure.

1. Private Limited Company (FDI Company)

This is the most common structure for foreign investors.

Features:

• 100 percent foreign ownership allowed in approved sectors

• Separate legal entity

• Limited liability

• Eligible for profit repatriation

Best for long-term operations and revenue generation.

2. Branch Office

A branch is an extension of the foreign parent company.

Key points:

• No separate legal personality

• Can conduct commercial activities

• Requires annual approval renewal

• Parent company bears full liability

Suitable for companies testing the Nepal market.

3. Liaison or Representative Office

This is a non-commercial presence.

Permitted activities include:

• Market research

• Relationship management

• Coordination with headquarters

Revenue generation is not allowed.

Comparison of Entity Options for Foreign Companies

How to Register a Company in Nepal: Step-by-Step Overview

Foreign founders often ask for a clear roadmap. Here is a simplified process.

Step 1: Sector and Investment Approval

Foreign investment approval is obtained from the relevant authority depending on capital size.

This includes:

• Business activity review

• Minimum investment threshold compliance

• National priority alignment

Step 2: Company Name Reservation

The proposed company name must be unique and compliant with naming rules.

Step 3: Company Incorporation

You submit incorporation documents to the Company Registrar.

Once approved, you receive:

• Certificate of Incorporation

• Company registration number

Step 4: Tax Registration

Every company must register for:

• Permanent Account Number (PAN)

• Value Added Tax (VAT), if applicable

Step 5: Capital Injection

Foreign investors must inject approved capital through formal banking channels.

Step 6: Operational Licensing

Depending on your sector, additional licenses may be required.

Documents Required to Register a Company in Nepal

Foreign companies should prepare documents carefully to avoid delays.

Common requirements include:

• Passport copies of shareholders and directors

• Certificate of incorporation of parent company

• Board resolution approving Nepal investment

• Memorandum and Articles of Association

• Project report and financial projections

All foreign documents must be notarised and, in many cases, apostilled.

Minimum Capital Requirements for Foreign Investors

Under current investment guidelines:

• The general minimum foreign investment threshold applies

• Capital must be injected through approved banking channels

• Phased capital injection is permitted

Exact thresholds may vary by sector.

How Long Does It Take to Register a Company in Nepal?

Timelines depend on documentation quality and sector approvals.

Typical ranges:

• Investment approval: 2 to 4 weeks

• Company incorporation: 3 to 5 working days

• Tax registration: 2 to 3 working days

End-to-end, most foreign companies complete registration within 4 to 6 weeks.

Costs Involved in Company Registration

Understanding cost upfront avoids surprises.

Costs generally include:

• Government registration fees

• Legal and compliance advisory fees

• Translation and notarisation costs

• Bank charges for capital remittance

Professional guidance reduces hidden costs caused by rejections and delays.

Taxation Overview for Foreign-Owned Companies

Foreign companies in Nepal are subject to:

• Corporate income tax

• Withholding tax on certain payments

• VAT, where applicable

Nepal also has Double Taxation Avoidance Agreements with several countries, reducing tax exposure.

Employment and Compliance Obligations

Once operational, companies must comply with labor laws.

This includes:

• Employment contracts

• Social security fund contributions

• Statutory leave and benefits

• Payroll tax compliance

Failure to comply can lead to penalties and license suspension.

Common Mistakes Foreign Companies Should Avoid

Many issues arise from poor planning.

Avoid these frequent errors:

• Choosing the wrong entity structure

• Underestimating compliance obligations

• Submitting incomplete or inconsistent documents

• Ignoring sector-specific restrictions

• Delaying capital injection

Expert support significantly reduces these risks.

Why Professional Support Matters

While it is legally possible to self-register, foreign companies face added complexity.

Professional advisors help with:

• Investment structuring

• Regulatory liaison

• End-to-end compliance

• Ongoing tax and HR obligations

This ensures your Nepal entity is compliant from day one.

Frequently Asked Questions (People Also Ask)

Is foreign ownership allowed in Nepal?

Yes. Nepal allows up to 100 percent foreign ownership in most approved sectors under foreign investment laws.

What is the minimum investment required to register a company in Nepal?

Foreign investors must meet the prescribed minimum investment threshold, which varies by sector and policy updates.

Can foreigners be directors of Nepali companies?

Yes. Foreign nationals can act as directors of Nepali companies without residency requirements.

Can profits be repatriated outside Nepal?

Yes. Profits, dividends, and capital can be repatriated through formal banking channels after tax compliance.

Do I need to visit Nepal to register a company?

Not always. With proper authorisation, most registration steps can be completed remotely.

Conclusion: How to Register a Company in Nepal Successfully

Understanding how to register a company in Nepal is the first step toward a successful South Asian expansion. With the right structure, proper documentation, and compliant execution, Nepal offers a stable and rewarding environment for foreign businesses.

The key is preparation, clarity, and professional guidance.

Call to Action

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