Private Limited Company Registration in Nepal Everything You Need to Know

Company registration in Nepal is no longer a complex, paper-heavy process reserved only for local entrepreneurs. With regulatory reforms, digital systems, and clear FDI laws, Nepal has become an increasingly attractive destination for foreign companies looking to establish a private limited company in South Asia.

Whether you are an international startup, IT firm, outsourcing company, or foreign investor entering Nepal through foreign direct investment (FDI), understanding the legal, tax, and compliance framework is essential. This guide gives you a complete, authoritative, and practical explanation of private limited company registration in Nepal, written specifically for foreign businesses.

Why Foreign Companies Are Choosing Nepal

Nepal offers a unique mix of cost efficiency, skilled talent, and investment protection.

Key advantages include:

• Competitive operating and labour costs

• English-speaking, educated workforce

• 100% foreign ownership in most sectors

• Strong investor protections under FITTA 2019

• Profit and capital repatriation rights

For many international firms, Nepal acts as a regional delivery hub, technology centre, or long-term growth market.

What Is a Private Limited Company in Nepal

A Private Limited Company (Pvt. Ltd.) is the most preferred legal structure for foreign investors in Nepal.

Key Characteristics

• Separate legal entity

• Limited liability of shareholders

• Can be fully foreign-owned (sector-permitting)

• Governed by the Companies Act, 2006

• Ideal for FDI, scalability, and repatriation

Company Registration in Nepal: Legal Framework

Foreign company registration in Nepal is governed by multiple laws.

Core Legislation

• Companies Act, 2006

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

• Industrial Enterprises Act, 2020

• Income Tax Act, 2002

• Labour Act, 2017

These laws collectively define ownership rules, compliance obligations, tax exposure, and investor rights.

Who Can Register a Company in Nepal

Foreign companies can register a private limited company if:

• The proposed business sector is open to FDI

• Minimum investment thresholds are met

• Regulatory approvals are obtained

Sectors Commonly Approved for FDI

• IT and software development

• Business process outsourcing

• Consulting and professional services

• Manufacturing and export industries

• Tourism and hospitality

Minimum Requirements for Foreign Company Registration

To complete company registration in Nepal, foreign investors must meet the following:

Basic Eligibility

1. Minimum one shareholder

2. Minimum one director

3. Registered office address in Nepal

4. Approved business activity

5. Prescribed minimum FDI capital

Step-by-Step Process: Company Registration in Nepal

Below is a simplified but accurate breakdown of the full process.

1. Company Name Reservation

• Filed online at the Office of Company Registrar (OCR)

• Name must be unique and compliant

• Typically approved within 1–3 working days

2. FDI Approval

• Application submitted to the Department of Industry or IBN

• Includes business plan and investment details

• Approval timeline: 2–4 weeks

3. Company Incorporation

• Submission of constitutional documents

• OCR issues Certificate of Incorporation

4. Tax and Statutory Registrations

• PAN and VAT registration

• Local ward registration

• Bank account opening

5. Capital Injection

• Foreign currency remitted via NRB-approved bank

• Share capital recorded officially

Documents Required for Company Registration in Nepal

Foreign companies must prepare both local and overseas documents.

Commonly Required Documents

• Passport copies of shareholders and directors

• Board resolution for Nepal investment

• Memorandum of Association (MOA)

• Articles of Association (AOA)

• Business plan and investment structure

• Parent company incorporation documents

All foreign documents must be notarised and apostilled.

Company Registration Cost in Nepal (FDI Perspective)

Costs vary based on capital size and structure.

Typical Cost Components

• Government registration fees

• FDI approval fees

• Legal and professional fees

• Notarisation and apostille costs

Comparison: Private Limited Company vs Other Structures

This is why company registration in Nepal via a private limited company is the most strategic option for long-term foreign investors.

Taxation After Company Registration in Nepal

Foreign-owned companies must comply with Nepal’s tax regime.

Key Taxes

• Corporate income tax: Generally 25%

• VAT: 13% (if applicable)

• Withholding tax on services

• Social Security Fund contributions

Professional tax planning significantly reduces risk.

Compliance Obligations for Foreign Companies

After company registration in Nepal, ongoing compliance is mandatory.

Annual and Monthly Obligations

• Monthly tax filings

• Payroll and SSF compliance

• Annual audit and financial statements

• Annual return submission to OCR

Non-compliance can lead to penalties and repatriation delays.

Repatriation of Profit and Capital

Nepal allows full repatriation of:

• Dividends

• Management fees

• Royalties

• Loan repayments

• Exit capital

This is guaranteed under FITTA 2019, subject to tax clearance.

Common Mistakes Foreign Investors Make

Avoid these costly errors:

• Choosing the wrong entry model

• Underestimating compliance workload

• Poor tax structuring

• Incomplete FDI documentation

• Delayed capital injection

Expert guidance is critical.

Why Professional Support Matters

Company registration in Nepal involves legal, tax, banking, and regulatory coordination. Foreign investors benefit from a single advisory partner that manages everything end-to-end.

Frequently Asked Questions (People Also Ask)

Is company registration in Nepal allowed for foreigners?

Yes. Foreigners can register a private limited company in Nepal under FITTA 2019, subject to sector approval and minimum investment rules.

How long does company registration in Nepal take?

Typically 4–8 weeks for foreign-owned companies, depending on FDI approval and document readiness.

Can a foreign company own 100% shares?

Yes. Most sectors allow 100% foreign ownership in Nepal.

What is the minimum investment for FDI in Nepal?

The standard minimum FDI threshold is NPR 20 million, unless sector-specific exemptions apply.

Is profit repatriation allowed after registration?

Yes. Nepal legally guarantees profit and capital repatriation after tax clearance.

Conclusion

Company registration in Nepal offers foreign companies a stable, scalable, and legally protected pathway into South Asia. A private limited company structure provides ownership control, tax clarity, and repatriation rights unmatched by other models.

With the right advisory partner, Nepal can become one of your most strategic international markets.

Call to Action

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