Private Limited Company Registration Process in Nepal Explained

The company registration process in Nepal is straightforward once you understand the legal steps, approval authorities, and post-registration compliance. For foreign companies, Nepal offers a stable regulatory framework, competitive operating costs, and access to South Asian markets.

This guide explains the private limited company registration process in Nepal in clear, practical terms. It is written specifically for foreign founders, CFOs, and expansion teams who want certainty, speed, and compliance from day one.

By the end, you will know exactly how to register a private limited company in Nepal, what documents are required, how long it takes, and where most foreign companies make costly mistakes.

Why Foreign Companies Choose Nepal

Nepal is increasingly attractive for international businesses seeking cost-efficient expansion and regional diversification.

Key drivers include:

• Competitive labour and operating costs

• English-speaking professional workforce

• Liberal foreign investment regime under FITTA 2019

• Strong protection of foreign investor rights

• Strategic access to India and China

From IT services to consulting, manufacturing, and shared services, Nepal supports a wide range of foreign-owned businesses.

What Is a Private Limited Company in Nepal?

A private limited company is the most common legal structure for foreign investors in Nepal.

Key Features

• Governed by the Companies Act 2006

• Separate legal entity

• Shareholder liability limited to share capital

• Minimum one shareholder

• Maximum 101 shareholders

• Can be 100% foreign-owned (subject to sector approval)

This structure is ideal for long-term operations, revenue generation, and hiring employees locally.

Authorities Involved in the Company Registration Process in Nepal

Foreign companies must coordinate with multiple government bodies.

Core Regulatory Institutions

• Office of Company Registrar (OCR) – Company incorporation

• Department of Industry (DOI) – Foreign investment approval

• Nepal Rastra Bank (NRB) – Capital repatriation oversight

• Inland Revenue Department (IRD) – Tax registration

• Social Security Fund (SSF) – Mandatory employee contributions

Understanding the role of each authority is essential to avoid delays.

Step-by-Step Company Registration Process in Nepal (Private Limited)

Step 1: Company Name Reservation at OCR

The process begins with reserving your proposed company name through the Office of Company Registrar.

Name guidelines:

• Must be unique

• Cannot resemble existing companies

• Must align with business activities

Approval typically takes 1–3 working days.

Step 2: Foreign Investment Approval (DOI)

Foreign investors must obtain approval under the Foreign Investment and Technology Transfer Act (FITTA) 2019.

You will submit:

• Investment proposal

• Shareholding structure

• Business objectives

• Capital investment amount

This step validates your eligibility for foreign ownership.

Step 3: Prepare Incorporation Documents

Once approved, legal documents are drafted and submitted.

These include:

• Memorandum of Association (MOA)

• Articles of Association (AOA)

• Shareholder resolutions

• Director appointment letters

Accuracy at this stage is critical to avoid re-submission.

Step 4: Company Registration at OCR

The Office of Company Registrar issues the Certificate of Incorporation.

This legally creates your private limited company in Nepal.

Typical processing time:

• 3–7 working days

Step 5: PAN and VAT Registration (IRD)

Your company must register with the Inland Revenue Department.

Mandatory registrations:

• Permanent Account Number (PAN)

• VAT registration (if applicable)

PAN is required for banking, invoicing, payroll, and tax filing.

Step 6: Bank Account Opening and Capital Injection

A local bank account is opened in Nepal.

Foreign shareholders:

• Inject capital via formal banking channels

• Comply with NRB foreign exchange rules

Proof of capital inflow is required for repatriation later.

Step 7: Local Ward Office Registration

Companies must register with the local municipality ward office where operations are based.

This step enables:

• Trade license issuance

• Local compliance recognition

Step 8: Social Security Fund (SSF) Registration

All employers must register employees under the Social Security Fund Act 2018.

Mandatory contributions:

• Employer: 20% of basic salary

• Employee: 11% of basic salary

Documents Required for Company Registration in Nepal

Foreign companies should prepare documents in advance to avoid delays.

Core Documentation Checklist

• Passport copies of shareholders and directors

• Shareholder resolution approving Nepal investment

• Power of Attorney (notarised)

• Investment approval letter (DOI)

• MOA and AOA

• Office address lease agreement

Missing or inconsistent documents are the top reason for OCR rejection.

Timeline for the Company Registration Process in Nepal

With professional support, timelines can be compressed.

Cost of Registering a Private Limited Company in Nepal

Costs vary based on capital size and service scope.

Typical Cost Components

• Government registration fees

• DOI approval charges

• Legal drafting fees

• Translation and notarisation

• Accounting and compliance setup

Foreign investors should budget realistically to avoid compliance shortcuts.

Compliance After Company Registration in Nepal

Registration is only the beginning.

Ongoing Obligations

• Monthly tax filings (TDS, VAT)

• Annual financial statements

• Audit requirements

• SSF contributions

• Board and shareholder meetings

Non-compliance can lead to penalties, blacklisting, or forced closure.

Common Mistakes Foreign Companies Make

Avoid these frequent errors:

• Underestimating compliance workload

• Using nominee structures incorrectly

• Injecting capital informally

• Ignoring labour law obligations

• Delaying tax registration

Professional guidance significantly reduces these risks.

Private Limited Company vs Other Business Structures

For most foreign investors, the private limited company remains the best option.

Legal Framework Governing the Company Registration Process in Nepal

Key legislation includes:

• Companies Act 2006

• Foreign Investment and Technology Transfer Act 2019

• Income Tax Act 2002

• Labour Act 2017

• Social Security Fund Act 2018

These laws protect investors while enforcing structured compliance.

Why Professional Support Matters

The company registration process in Nepal involves legal, tax, and regulatory coordination.

Professional advisors help with:

• Accurate filings

• Faster approvals

• Risk mitigation

• Post-registration compliance

This is especially critical for foreign companies unfamiliar with Nepal’s regulatory environment.

FAQs: Company Registration Process in Nepal

How long does company registration take in Nepal?

The company registration process in Nepal usually takes 2–4 weeks for foreign companies, depending on investment approval and document readiness.

Can a foreigner fully own a company in Nepal?

Yes. Nepal allows 100% foreign ownership in most sectors under FITTA 2019, subject to DOI approval.

What is the minimum capital requirement?

There is no fixed minimum, but foreign investment proposals typically start from NPR 5 million, depending on the sector.

Is VAT registration mandatory?

VAT registration is mandatory if annual turnover exceeds the statutory threshold or if operating in VAT-applicable sectors.

Can profits be repatriated?

Yes. Nepal guarantees profit and capital repatriation through Nepal Rastra Bank, subject to tax clearance.

Conclusion

The company registration process in Nepal offers foreign companies a transparent, legally protected path to South Asian expansion. With the right structure, accurate documentation, and proactive compliance, Nepal can be an efficient and rewarding market.

If you are planning to register a private limited company in Nepal, expert guidance can save months of delays and long-term risk.

Call to Action

Planning company registration in Nepal?
Speak with our Nepal expansion specialists for a free consultation, document checklist, and timeline assessment tailored to your business.