Nepal Tax Filing Guide
Nepal's tax filing system is administered by the Inland Revenue Department (IRD) through its online portal. Individuals must file their annual tax return by mid-October (following the mid-July year-end). Corporate returns are due within 3 months of year-end. PAN registration is mandatory for all taxpayers. VAT returns are filed monthly. Late filing attracts penalties of up to 25%.
Tax filing in Nepal is managed through the IRD online portal (ict.ird.gov.np) and physical submission at local IRD offices. The system covers income tax, VAT, and withholding tax. All taxpayers are required to obtain a Permanent Account Number (PAN). For related guidance, see our Personal Tax Guide →, Corporate Tax Guide →, and Tax Residency Guide →.
PAN Registration
- Mandatory for all: Every taxpayer (individual, company, partnership, trust) must obtain a Permanent Account Number (PAN) from the IRD. PAN is required for filing tax returns, opening bank accounts, registering property, and conducting business.
- Application: Apply online at the IRD portal or in person at any IRD office. Required documents include: citizenship certificate/passport, passport-size photo, and proof of address. Companies need their company registration certificate and memorandum of association.
- PAN card: The IRD issues a physical PAN card with a unique 9-digit alphanumeric number. The PAN must be quoted on all tax filings, invoices, receipts, and correspondence with the IRD.
Filing Deadlines
- Individuals: The annual income tax return for individuals must be filed by approximately mid-October (3 months after the end of the Nepali fiscal year on Ashad 31 / mid-July). The exact date is published by the IRD annually.
- Companies: Corporate tax returns must be filed within 3 months of the company's fiscal year-end. For calendar year-end companies, the deadline is typically October 15. For Nepali fiscal year-end companies (mid-July), the deadline is approximately October 15-17.
- VAT returns: VAT returns are due monthly by the 25th of the following month.
- Withholding tax: WHT must be remitted to the IRD within 25 days of the end of the month in which the payment was made. A monthly WHT return must be filed.
Filing Process
- Online filing: The IRD provides an online tax filing portal (ict.ird.gov.np) where taxpayers can file returns, view tax credits, make payments, and download certificates. Electronic filing is mandatory for registered businesses and recommended for individuals.
- Physical filing: Individuals may file paper returns at their local IRD office. The return must be in the prescribed form (usually Form 1 for individuals, Form 1A for companies) with supporting documents (pay statements, bank interest certificates, proof of deductions).
- Advance tax: Taxpayers with significant income must pay advance tax in four quarterly installments (Paush, Chaitra, Ashad, Ashwin). Advance tax is estimated based on the prior year's liability.
- Tax payment: Taxes can be paid online through the IRD portal (via bank transfer or card) or at designated bank branches using the IRD payment slip. The IRD issues a tax clearance certificate upon full payment.
Penalties and Interest
- Late filing: Failure to file a tax return by the deadline attracts a penalty of up to 25% of the tax due, subject to a minimum penalty amount prescribed by the IRD (typically NPR 500-5,000).
- Late payment: Late payment of tax attracts interest at the prevailing rate (approximately 12-15% per annum, compounded monthly). The interest runs from the original due date until the date of payment.
- Non-filing: Persistent non-compliance may result in assessment by the IRD (best judgment assessment), seizure of assets, travel bans, and prosecution.
For record-keeping requirements and tax audits, see our Cross-Border Guide → and Corporate Tax Guide →.