Company registration in Nepal: foreign investor roadmap 2025

Company registration in Nepal is clear when you plan the legal, banking, and tax steps together. This guide explains each step in plain language. It is written for foreign founders and corporate expansion teams. You will learn the entity options, FDI approvals, tax registrations, and repatriation rules. You will also see realistic costs, timelines, and a 180-day compliance plan.

The process blends several touchpoints. You will interact with the Office of the Company Registrar (OCR). You will file under the Foreign Investment and Technology Transfer Act (FITTA). You will record funds with Nepal Rastra Bank (NRB). You will obtain PAN and, when required, register for VAT. Getting the order right avoids delays and rework.

2025 at a glance

• Minimum FDI practice remains a defined floor per FITTA rules.

• OCR filings run on an online portal with standardized forms.

• VAT continues at a standard rate, with turnover triggers for registration.

• NRB recording remains essential for future repatriation.

• Sectoral licenses still apply for regulated industries.

• Documentation quality drives speed more than anything else.

Laws and practice referenced: Companies Act 2063, FITTA 2019, NRB Foreign Investment and Foreign Loan By-laws, Income Tax Act, VAT Act, and related rules.

Company registration in Nepal: entity options for foreign investors

Choosing the right vehicle is the first big decision. Start with your revenue intent, capital plan, and timeline.

Quick comparison table

*Assumes complete documents and standard reviews.

How to choose fast:

• Need to sell and hire locally? Choose Private Limited.

• Have a defined parent scope and contracts? Consider a Branch.

• Only testing the market with no sales? Open a Liaison.

• Planning capital markets later? Use a Public Limited.

The foreign investor roadmap (2025)

Follow these steps in order. Keep a single source folder for all documents.

Step 1: Confirm sector and FDI minimums

Check that your activity is permitted for foreign investment. Review negative lists and sectoral caps. Confirm any sector-specific capital floors. Decide the approving route. Projects up to a defined value use the Department of Industry (DOI). Larger projects use the Investment Board Nepal (IBN).

Outputs: sector note, investment plan, ownership chart, and a draft term sheet.

Step 2: Reserve the name and draft constitutional documents

Reserve a unique name through the OCR system. Draft your Memorandum of Association (MOA) and Articles of Association (AOA). Align the MOA objects with your proposed activities and FDI application. Prepare director KYC, address proofs, and a registered office lease or consent.

Outputs: name reservation, signed MOA/AOA, director KYC, and office evidence.

Step 3: Incorporate the company with OCR

File incorporation on the OCR portal. Attach MOA, AOA, board resolutions, and KYC. Respond to any queries quickly. On approval, OCR issues the Certificate of Incorporation. Maintain soft and hard copies for banking and tax.

Outputs: incorporation certificate, PAN application pack draft, share register template.

Step 4: Obtain FDI approval under FITTA

Apply to DOI or IBN with your investment proposal. Include your business plan, funding schedule, and any joint venture agreement. Include a technology transfer agreement if relevant. Approval letters state the amount, instruments, and conditions.

Outputs: FDI approval letter, updated cap table plan, and a filing calendar.

Step 5: Open the bank account and bring in funds

Open a capital account in the company’s name. Remit funds through banking channels only. Match the remitter name with shareholder names. Keep swift copies and bank inflow certificates. Record the foreign investment with NRB within the required window.

Outputs: bank inflow certificate, NRB recording file, and capital recognition in books.

Step 6: Obtain PAN and assess VAT registration

Apply for Permanent Account Number (PAN) after incorporation. Assess VAT registration triggers. Register when you meet the turnover test or a mandatory condition. Plan invoice formats, e-invoicing flow, and return cycles.

Outputs: PAN certificate, VAT certificate (when applicable), and tax calendar.

Step 7: Local registrations and social security

Complete ward or municipal registrations if required. Enroll the employer and all employees in the Social Security Fund (SSF). Align employment contracts with the Labour Act and HR policies.

Outputs: local registration, SSF account, and compliant HR templates.

Step 8: Sectoral licenses and approvals

Check if your sector needs specific approvals. Examples include education services, healthcare, hydropower, telecom, and fintech. Build the license pack early to prevent launch delays.

Outputs: sector license checklists and submission calendars.

Step 9: Post-investment corporate actions

Issue share certificates and update the share register. Record board approvals for allotments. Appoint an auditor. Set the first Annual General Meeting timeline. Maintain minute books and statutory registers.

Outputs: share certificates, registers, auditor letter, and AGM plan.

Step 10: Monthly and annual compliance

File VAT returns, TDS statements, and advance tax. Close annual financial statements. Complete statutory audit and tax filing. Maintain a repatriation file for any future dividends. Keep contracts and invoices audit-ready.

Outputs: monthly returns, audited accounts, tax clearance, and repatriation dossier.

Money in, money out: NRB recording and repatriation

NRB recording protects your right to repatriate. Record every equity inflow and foreign loan properly. Keep exact supporting documents. Use consistent shareholder names across all filings. Keep the share register updated.

Repatriation scope includes: dividends, capital gains, loan principal, interest, royalties, and technical fees.
Approval flow: pay taxes, pass board or AGM actions, then seek approvals per NRB practice.
Good files contain: audited accounts, tax clearance, bank inflow certificates, FDI approvals, and share registers.

Pro tip: Build the repatriation file during the year. Do not wait until the dividend declaration.

VAT and PAN essentials for foreign-owned companies

• PAN is mandatory for all registered entities.

• VAT is mandatory only after a trigger or specific condition.

• The standard VAT rate remains stable in practice.

• Exports can be zero-rated with full documentation.

• Keep supplier invoices compliant for input tax credits.

• Choose monthly or quarterly VAT cycles per eligibility.

• Map withholding taxes for cross-border services and royalties.

• Align invoices with e-invoicing and serial rules.

What founders get wrong: They register for VAT too early or too late. This either adds avoidable admin or triggers penalties. Track your rolling 12-month turnover and plan ahead.

Typical first-year costs and timelines 

These are planning ranges. Sector licenses, premises, and staffing add to costs. Quality documentation reduces time and rework.

The 180-day compliance calendar

Numbered checklist

1. Incorporate, then secure FDI approval.

2. Open the bank account. Remit capital.

3. Record each inflow with NRB.

4. Obtain PAN. Assess VAT and register when due.

5. Register locally and enroll in SSF.

6. Issue share certificates and update registers.

7. Appoint an auditor and set the AGM calendar.

8. Start monthly VAT and TDS filings.

9. Review cross-border contracts for withholding taxes.

10. Build the repatriation file during the year.

Document checklist you can copy today

Founders and shareholders

• Passports and recent photos.

• Addresses and tax IDs, where available.

• Source-of-funds note and KYC declaration.

Company

• Name reservation approval.

• Signed MOA and AOA.

• Board resolutions and specimen signatures.

• Registered office lease or consent.

FDI and banking

• Investment proposal and funding schedule.

• JV or shareholder agreement.

• Swift copies and bank inflow certificates.

• NRB recording forms and covering letters.

Tax and payroll

• PAN application pack.

• VAT application and invoice formats.

• SSF enrollment pack.

• Employment contracts and HR policies.

Governance

• Statutory registers.

• Minute books and seal control.

• Auditor engagement letter.

• Compliance calendar and task owners.

Hiring, visas, and HR basics

• Senior foreign staff may apply for an Investor or Work visa route.

• Align job descriptions with your MOA objects.

• Use clear probation, leave, and confidentiality clauses.

• Enroll all staff in SSF and maintain payroll records.

• Keep personal data secure and access-controlled.

• Adopt a bilingual handbook if teams include non-Nepali speakers.

Sector notes for 2025

Education and training: Verify licensing and curriculum approvals.
Healthcare and devices: Expect facility and product registrations.
Fintech and payments: Review capital floors and fit-and-proper tests.
Hydropower and renewables: Consider land, environment, and power purchase steps.
Telecom and data: Align with spectrum, infrastructure, and data rules.
E-commerce: Map marketplace, warehousing, and consumer protection duties.

Tip: Start sector license packs in parallel with OCR filings. This preserves your launch date.

Common pitfalls and how to avoid them

• Objects mismatch: MOA does not match the FDI approval. Align language before filing.

• Unrecorded equity: Funds arrive but are not recorded with NRB. Assign a deadline owner.

• VAT timing errors: Registration too early or too late. Track triggers monthly.

• Wrong vehicle: Liaison chosen when invoicing is required. Pick Pvt. Ltd. or branch.

• Messy share registers: Certificates are late or inconsistent. Update after each allotment.

• Repatriation surprises: Dividend planned without tax clearance. Prepare during the year.

Which structure should you choose?

• Private Limited if you need sales, hiring, and contracts soon.

• Branch if you must execute parent contracts under the same brand.

• Liaison if you only research the market with no sales.

• Public Limited if you want governance scale or a future listing.

FAQ (People Also Ask)

1) What is the minimum foreign investment to start a company?
There is a defined minimum under FITTA practice. Some sectors require more. Larger projects use IBN. Smaller projects use DOI.

2) Do I need VAT from day one?
Not always. Register when you cross the turnover trigger or meet a mandatory condition. Many startups time VAT with first taxable invoices.

3) How do I repatriate dividends?
Close audited accounts. Obtain tax clearance. Pass board or AGM actions. Apply through your bank under NRB procedures and keep full records.

4) Can a liaison office sell products or services?
No. A liaison office cannot invoice or book revenue. Choose a private limited or branch if you plan to sell.

5) How long does incorporation take?
Private limited incorporation often completes in two to four weeks with clean files. Add time for FDI approval, banking, NRB recording, and VAT.