Business entities in Nepal

Business entities in Nepal

Healy Consultants will assist our Clients with Nepal business setup after advising them on the optimum corporate structure. There are several ways of doing business in Nepal, the most common being the setting up of a limited liability company. Foreign entrepreneurs may also opt to set up a public limited company, a branch office or a representative office.

Nepal limited liability company (LLC)

    Setup a company in Nepal
  • A Nepalese LLC is commonly used by entrepreneurs to setup an SME. An LLC must appoint at least 1 director and 1 shareholder who can be of any nationality. The minimum paid-up share capital required to complete the incorporation process is US$1;
  • An LLC in Nepal must maintain its books of accounts either in English or Nepali at its registered office in Nepal. The accounts must be maintained according to the double entry system of accounting in accordance with the Nepal Accounting Standards issued by the Institute of Chartered Accountants of Nepal (ICAN). Annual financial statements must be prepared and an audit must be submitted every year. A Nepal LLC must appoint an auditor from the list of auditors provided by ICAN.

Nepal public limited company (PLC)

  • This business entity requires a minimum capital of US$100,500 for incorporation. The minimum paid-up capital can be higher for companies in the business of banking and financial services. Furthermore, at least 7 shareholders and 3 directors must be appointed, who can be of any nationality. A Nepal PLC must also appoint a resident company secretary. Healy Consultants will provide this service to our Client if required;
  • The Nepal PLC must hold its first annual general meeting within one year of incorporation and subsequently every year within six months after the close of its financial year. The board of directors must meet at least six times a year;
  • Similar to an LLC, PLCs in Nepal must also submit annual financial statements and an auditor’s report every year.

Nepal branch office

A Nepal branch office can be 100% foreign owned. The scope of operations for this entity will be defined by the parent company. Also, the branch office must have a registered office in Nepal as well as a resident agent appointed by the company to receive summons, notices etc. on behalf of the company.

The Nepal representative office (liaison office)

While the Nepal representative office can be 100% foreign owned, it is not allowed to carry out any income generating activities in Nepal. All expenses of the representative office are required to be met through inward foreign currency remittances. Consequently, this entity can only engage in i) market research and ii) promoting the business of the parent company.

Table of comparison between Nepal entities

 LLCPLCBranchRep Office
How long to set the company up?4 weeks5 weeks6 weeks6 weeks
How long to open company bank account?4 weeks4 weeks4 weeks4 weeks
Legal liability?LimitedLimitedUnlimitedUnlimited
Wholly foreign owned?YesYesYesYes
Minimum paid - up share capital?US$1US$100,500US$1US$1
File annual tax return?YesYesYesNo
Tax registration certificate required?YesYesYesNo
Recommended corporate bank account?Standard Chartered Bank Nepal LtdNepal Bank LimitedRastriya Banijya Bank LimitedHimalayan Bank Limited
Does our Client need to travel?NoNoNoNo
Resident director required?NoNoNoNo
Resident shareholder required?NoNoNoNo
Minimum directors allowed?1311
Minimum shareholders?1711
Tax identification code needed?YesYesYesYes
Nepal resident company secretary required?NoYesNoNo
Corporate shareholders allowed?YesYesYesYes
Corporate director(s) allowed?NoNoNoYes
Statutory audit required?YesYesYesNo
Nepal corporate tax rate?20%-30%20%-30%20%-30%0%
Annual financial statements required?YesYesYesNo
Regulated by?Department of Industry NepalDepartment of Industry NepalDepartment of Industry NepalDepartment of Industry Nepal
Allowed to issue sales invoices?YesYesYesNo
Allowed to sign contracts?YesYesYesNo
Allowed to import and export goods?YesYesYesNo
Can rent an office space in Nepal?YesYesYesYes
Can buy Nepal property?YesYesYesNo
Total Nepal business setup costs in yr. 1?US$14,500US$15,500US$16,800US$17,200
Subsequent annual costs (incl. accounting and tax fee)?US$3,400US$3,400US$3,400US$3,400
Sample engagement invoice?Singapore LLC setup costNepal PLC invoiceNepal branch invoiceNepal RO invoice

Frequently asked questions

External videos

Contact us

For additional information on our business setup services in Nepal, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Ms. Olivia Stanciu, directly:
nepal ministry of finance nepal ministry of commerce and supplies the institute of chartered accountants of nepal federation of Nepalese Chammers of Commerce & Industry (FNCCI) nepal employees provident fund confederation of Nepalese industries nepal accounting standards board nepal rastra bank