Business entities in Nepal in 2022

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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)

    • 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

      LLC PLC Branch Rep Office
    How long to set the company up? 4 weeks 5 weeks 6 weeks 6 weeks
    How long to open company bank account? 4 weeks 4 weeks 4 weeks 4 weeks
    Legal liability? Limited Limited Unlimited Unlimited
    Wholly foreign owned? Yes Yes Yes Yes
    Minimum paid - up share capital? US$1 US$100,500 US$1 US$1
    File annual tax return? Yes Yes Yes No
    Tax registration certificate required? Yes Yes Yes No
    Recommended corporate bank account? Standard Chartered Bank Nepal Ltd Nepal Bank Limited Rastriya Banijya Bank Limited Himalayan Bank Limited
    Does our Client need to travel? No No No No
    Resident director required? No No No No
    Resident shareholder required? No No No No
    Minimum directors allowed? 1 3 1 1
    Minimum shareholders? 1 7 1 1
    Tax identification code needed? Yes Yes Yes Yes
    Nepal resident company secretary required? No Yes No No
    Corporate shareholders allowed? Yes Yes Yes Yes
    Corporate director(s) allowed? No No No Yes
    Statutory audit required? Yes Yes Yes No
    Nepal corporate tax rate? 20%-30% 20%-30% 20%-30% 0%
    Annual financial statements required? Yes Yes Yes No
    Regulated by? Department of Industry Nepal Department of Industry Nepal Department of Industry Nepal Department of Industry Nepal
    Allowed to issue sales invoices? Yes Yes Yes No
    Allowed to sign contracts? Yes Yes Yes No
    Allowed to import and export goods? Yes Yes Yes No
    Can rent an office space in Nepal? Yes Yes Yes Yes
    Can buy Nepal property? Yes Yes Yes No
    Total Nepal business setup costs in yr. 1? US$14,500 US$15,500 US$16,800 US$17,200
    Subsequent annual costs (incl. accounting and tax fee)? US$3,400 US$3,400 US$3,400 US$3,400
    Sample engagement invoice? View invoice PDF View invoice PDF View invoice PDF View invoice PDF

Frequently asked questions

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Contact us

For additional information on our business setup services in Nepal, please contact our in-house country expert, Mr. Seth Ochieng, directly:
Director of Client Engagements - Seth
  • Mr. Seth Ochieng
  • Director of Client Engagements
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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