Company Registration Fees in Nepal

What is Company Registration in Nepal?

Company registration in Nepal is a crucial step for entrepreneurs and businesses looking to establish a legal entity in the country. The process involves various fees and charges that must be paid to different government authorities. This comprehensive guide aims to provide detailed information about the company registration fees in Nepal, including the types of fees, fee structure, required documents, payment methods, and relevant laws and regulations.

In Nepal, the Company Act 2063 (2006) governs the registration and operation of companies. The Office of Company Registrar (OCR), under the Ministry of Industry, Commerce and Supplies, is the primary authority responsible for company registration and related matters. Understanding the fee structure and requirements is essential for a smooth and efficient registration process.

2. Types of Company Registration Fees

Company registration fees in Nepal can be broadly categorized into several types, each corresponding to different stages of the registration process. These fees include:

1. Name reservation fee
2. Registration fee based on authorized capital
3. Memorandum and Articles of Association fee
4. PAN (Permanent Account Number) registration fee
5. Other miscellaneous fees

It is important to note that these fees may vary depending on the type of company being registered, such as private limited company, public limited company, or non-profit organization.

3. Fee Structure

3.1. Step 1: Name Reservation Fee

The first step in company registration is reserving a unique name for the company. The fee for name reservation is as follows:

• Name reservation fee: NPR 100 (approximately USD 0.85)

This fee is payable to the Office of Company Registrar. The name reservation is valid for 30 days, during which the applicant must complete the registration process.

3.2. Step 2: Registration Fee Based on Authorized Capital

The registration fee is calculated based on the authorized capital of the company. The fee structure is as follows:

• For authorized capital up to NPR 100,000: NPR 1,000
• For authorized capital between NPR 100,001 to NPR 500,000: NPR 4,500
• For authorized capital between NPR 500,001 to NPR 2,500,000: NPR 9,500
• For authorized capital between NPR 2,500,001 to NPR 10,000,000: NPR 16,000
• For authorized capital above NPR 10,000,000: NPR 16,000 plus NPR 50 for every NPR 100,000 or part thereof exceeding NPR 10,000,000

It is important to note that these fees are subject to change, and it is advisable to consult the latest fee schedule published by the Office of Company Registrar.

3.3. Step 3: Memorandum and Articles of Association Fee

The Memorandum and Articles of Association are crucial documents that define the company’s purpose, structure, and internal regulations. The fee for filing these documents is:

• Memorandum and Articles of Association fee: NPR 1,000

This fee covers the cost of reviewing and processing these important documents by the Office of Company Registrar.

3.4. Step 4: PAN Registration Fee

Every company in Nepal is required to obtain a Permanent Account Number (PAN) for tax purposes. The fee for PAN registration is:

• PAN registration fee: NPR 200

This fee is payable to the Inland Revenue Department (IRD) of Nepal.

3.5. Step 5: Other Miscellaneous Fees

In addition to the main registration fees, there may be other miscellaneous charges, including:

• Stamp duty: Varies based on the authorized capital (approximately 0.5% of the authorized capital)
• Notary fee: NPR 500 – 1,000 (depending on the notary public)
• Document certification fee: NPR 50 per page
• Company seal making charge: NPR 500 – 1,000

These fees may vary depending on the specific requirements of the company and the service providers involved in the registration process.

4. Documents Required for Fee Payment

To pay the registration fees, the following documents are typically required:

1. Completed company registration application form
2. Proposed company name approval letter
3. Memorandum and Articles of Association
4. Citizenship certificates of promoters/directors
5. Passport-sized photographs of promoters/directors
6. PAN registration application form
7. Proof of office address (rental agreement or ownership documents)
8. Bank deposit slip or payment receipt for the required fees

It is crucial to ensure that all documents are properly filled out and notarized where required to avoid any delays in the registration process.

5. Our Services

As experienced legal professionals specializing in company registration in Nepal, we offer comprehensive services to guide you through the entire registration process, including:

• Assistance with name reservation and approval
• Preparation of Memorandum and Articles of Association
• Calculation and payment of all required fees
• Document preparation and submission
• Liaison with relevant government authorities
• PAN registration assistance
• Post-registration compliance guidance

Our expert team ensures a smooth and efficient registration process, helping you navigate the complexities of Nepalese company law and regulations.

6. Time Taken for Fee Processing

The time taken for fee processing and company registration can vary depending on various factors. However, the typical timeline is as follows:

• Name reservation: 1-2 working days
• Document preparation and submission: 3-5 working days
• Registration fee payment and processing: 1-2 working days
• PAN registration: 2-3 working days
• Overall registration process: 7-14 working days

It is important to note that these timelines are approximate and may be subject to change based on the workload of the relevant authorities and the completeness of the submitted documents.

7. Payment Methods

The payment of registration fees in Nepal can be made through the following methods:

1. Bank deposit: Fees can be deposited directly into the designated government bank account.
2. Online payment: The Office of Company Registrar has introduced an online payment system for certain fees.
3. Demand draft: A bank-issued demand draft payable to the Office of Company Registrar.
4. Cash payment: In some cases, cash payments may be accepted at the OCR office.

It is advisable to confirm the accepted payment methods with the relevant authorities before making any payments.

8. Laws & Authorities Governing Registration Fees

The primary laws and authorities governing company registration fees in Nepal include:

1. Company Act 2063 (2006): This act provides the legal framework for company registration and operation in Nepal.
2. Office of Company Registrar (OCR): The main authority responsible for company registration and related matters.
3. Inland Revenue Department (IRD): Responsible for PAN registration and tax-related matters.
4. Industrial Enterprises Act 2076 (2020): Governs the registration and operation of industrial enterprises.
5. Foreign Investment and Technology Transfer Act 2075 (2019): Regulates foreign investment in Nepalese companies.

These laws and authorities work together to ensure a structured and regulated company registration process in Nepal.

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9. Fee Practices in Nepal

Company registration fee practices in Nepal are designed to promote transparency and encourage business growth. Some key aspects of fee practices include:

1. Progressive fee structure: Registration fees are calculated based on the authorized capital, ensuring that smaller companies pay lower fees.
2. Regular fee revisions: The government periodically reviews and updates the fee structure to align with economic conditions.
3. Online fee payment: The introduction of online payment systems has made the fee payment process more convenient and efficient.
4. Fee waivers for certain sectors: The government occasionally offers fee waivers or reductions for companies in priority sectors or underdeveloped regions.
5. Transparency in fee structure: The fee schedule is publicly available and regularly updated on the OCR website.

These practices aim to create a business-friendly environment while ensuring that the registration process remains accessible to a wide range of entrepreneurs and investors.

10. Conclusion

Understanding the company registration fees in Nepal is crucial for entrepreneurs and businesses looking to establish a legal entity in the country. The fee structure, while seemingly complex, is designed to be progressive and accommodate companies of various sizes and capital structures.

By following the proper procedures, preparing the required documents, and paying the necessary fees, businesses can successfully register their companies in Nepal. It is advisable to seek professional assistance to ensure compliance with all legal requirements and to navigate the registration process efficiently.

As the business landscape in Nepal continues to evolve, it is important to stay informed about any changes in registration fees and procedures. Regular updates from the Office of Company Registrar and other relevant authorities should be monitored to ensure ongoing compliance and smooth business operations.

FAQs

How much does it cost to register a company in Nepal?

The total cost of registering a company in Nepal varies depending on the authorized capital and type of company. For a typical private limited company with an authorized capital of NPR 1,000,000, the approximate costs would be:

• Name reservation fee: NPR 100
• Registration fee: NPR 9,500
• Memorandum and Articles of Association fee: NPR 1,000
• PAN registration fee: NPR 200
• Stamp duty: NPR 5,000 (0.5% of authorized capital)
• Miscellaneous fees: NPR 2,000 – 3,000

Total approximate cost: NPR 17,800 – 18,800 (USD 150 – 160)

Are there different fees for different types of companies?

Yes, there are different fee structures for various types of companies. For example:

• Private Limited Companies: Follow the standard fee structure based on authorized capital.
• Public Limited Companies: Generally have higher fees due to larger capital requirements.
• Non-Profit Organizations: May have reduced fees or different fee structures.
• Foreign Companies: May have additional fees related to foreign investment approvals.

Can registration fees be paid online?

Yes, the Office of Company Registrar has introduced an online payment system for certain fees. However, not all fees may be payable online, and it’s advisable to check the latest payment options on the OCR website or consult with a registration expert.

Are there any additional fees after the initial registration?

Yes, companies may incur additional fees after initial registration, including:

• Annual return filing fee
• Share capital increase fee
• Amendment of Memorandum and Articles of Association fee
• Change of company name fee
• Branch office registration fee

These fees vary depending on the specific requirements and changes made to the company structure.

How often do company registration fees change in Nepal?

Company registration fees in Nepal are subject to periodic review and may change based on government policies and economic factors. While there is no fixed schedule for fee changes, it is common for fees to be reviewed every few years. It is advisable to consult the latest fee schedule published by the Office of Company Registrar or seek professional advice to ensure you have the most up-to-date information on registration fees.