Introduction

A Permanent Account Number (PAN) in Nepal is a unique identification number issued by the Inland Revenue Department (IRD) under the Ministry of Finance. It is mandatory for every business entity—whether incorporated as a private limited company, public company, partnership firm, cooperative, or proprietorship—to obtain a Business PAN before carrying out financial transactions, issuing invoices, or filing taxes. How to Register a Business PAN in Nepal.  The Income Tax Act, 2058 (2002) and Value Added Tax Act, 2052 (1996) provide the legal framework for PAN registration and tax compliance in Nepal.

PAN registration ensures that every business is recognized by the tax authority, thereby enabling tax collection, transaction monitoring, and compliance under Nepali law. Without PAN registration, businesses cannot open a bank account in their name, issue VAT invoices, deduct tax at source (TDS), or participate in government procurement.

This article provides a detailed, structured, and factual guide to how to register a business PAN in Nepal, covering the requirements, process, documents, cost, timeline, and compliance obligations. Medha Law and Partners Is a leading law firm in Nepal.

What is a Business PAN in Nepal?

A Business PAN is a unique 9-digit alphanumeric code issued by the Inland Revenue Department of Nepal. It is used to identify business entities for tax purposes. It acts as the official tax identity of a business in Nepal.

• It is distinct from an individual PAN (issued to individuals for income tax purposes).

• Every business must have its own PAN regardless of whether the owner already holds an individual PAN.

• PAN must be obtained within 35 days from the date of company registration or business commencement, as required by the Income Tax Rules, 2059 (2002).

Legal Framework for Business PAN Registration in Nepal

1. Income Tax Act, 2058 (2002) – Governs the requirement of PAN for all taxpayers.

2. Income Tax Rules, 2059 (2002) – Provides procedures for PAN registration.

3. Value Added Tax Act, 2052 (1996) – Businesses liable to VAT must obtain VAT registration along with PAN.

4. Finance Act (Annual Updates) – Defines provisions for PAN compliance, penalties, and tax administration.

5. Inland Revenue Department Directives – Provide detailed compliance guidelines for online and physical submission of PAN applications.

Why Register a Business PAN in Nepal?

• Legal Compliance – PAN registration is compulsory under the Income Tax Act.

• Banking Transactions – Banks require a PAN certificate to open a business bank account.

• Tax Filing – PAN is mandatory for filing income tax returns, VAT returns, and withholding tax.

• Business Operations – PAN is required for issuing bills, conducting trade, and applying for government tenders.

• Audit and Transparency – PAN ensures transparency in financial records and supports statutory audits.

Authority Responsible for how to Register a Business PAN in Nepal

The Inland Revenue Department (IRD) and its respective Taxpayer Service Offices (TSOs) are responsible for issuing PAN certificates.

• Businesses located in Kathmandu Valley must apply to the Taxpayer Service Office as per jurisdiction.

• Businesses outside Kathmandu must apply at the respective Inland Revenue Office.

• Online PAN registration is available through the IRD official website (www.ird.gov.np).

Documents Required for Business PAN Registration in Nepal

The following documents are mandatory for registering a business PAN in Nepal:

• Company Registration Certificate (issued by the Office of the Company Registrar)

• Memorandum of Association (MOA) and Articles of Association (AOA)

• Citizenship certificate of directors/shareholders or proprietor

• Tax Registration Application Form (available online from IRD)

• Lease agreement or ownership document of the business premises

• Passport-size photographs of directors/proprietors

• Company Seal and Stamp

• Board resolution authorizing the PAN registration (in case of companies)

• Power of Attorney (if applying through a legal representative)

Step-by-Step Process for Business PAN Registration in Nepal

1. Prepare Required Documents

   • Gather company incorporation certificate, MOA, AOA, citizenship copies, and office address proof.

2. Fill Online PAN Application Form

   • Visit the IRD portal (www.ird.gov.np)

   • Select PAN registration section

   • Fill in details such as company name, address, ownership structure, contact number, and business objectives

3. Submit Application

   • Upload scanned documents on the portal

   • Submit the application electronically

4. Print and Sign PAN Application Form

   • After online submission, print the form

   • Affix company stamp and authorized signature

5. Visit Taxpayer Service Office

   • Submit the signed application form along with documents to the respective TSO/IRD office

6. Verification by IRD Officer

   • The IRD officer verifies documents and company details

   • Physical inspection of business premises may be conducted

7. Issuance of Business PAN Certificate

   • Upon successful verification, the PAN certificate is issued

   • The certificate includes the unique PAN number of the business

Cost of Business PAN Registration in Nepal

• PAN registration itself is free of charge.

• Costs incurred are related to documentation, notary, printing, and legal service fees if engaged.

• Service fees of legal consultants vary depending on whether additional compliance such as VAT registration or tax advisory is required.

Timeline for Business PAN Registration in Nepal

• Online Application Filling – 1 day

• Submission to IRD/TSO – Same day or next day

• Verification and Approval – 3 to 5 working days

• Issuance of PAN Certificate – Within 7 working days from submission

Post-PAN Registration Compliance

Once PAN is obtained, businesses must comply with ongoing tax and regulatory obligations:

• Tax Returns – Monthly VAT returns, quarterly TDS returns, and annual income tax returns must be filed.

• Record Keeping – Maintain financial records, invoices, and audit reports.

• PAN Quoting Requirement – PAN number must be mentioned on all invoices, contracts, and payment vouchers.

• Renewal – PAN does not require renewal, but compliance filings must be maintained regularly.

Challenges in Business PAN Registration in Nepal

• Documentation errors due to incomplete or inaccurate submissions

• Delays in verification where business address proof is unclear

• Difficulty in online submission due to portal errors

• Requirement of physical presence at Taxpayer Service Office despite online application availability

Advantages of Professional Assistance in PAN Registration

Engaging a professional legal and tax consultant simplifies the process:

• Ensures accuracy of documentation and application

• Expedites approval timeline

• Reduces risk of penalties due to non-compliance

• Provides integrated advisory on VAT registration, income tax filing, and ongoing compliance

Conclusion

Registering a Business PAN in Nepal is a statutory requirement for all business entities under the Income Tax Act, 2058 (2002). The process is administered by the Inland Revenue Department (IRD) and requires submission of incorporation documents, citizenship copies, and office address proof. While the process can be completed online, physical verification by the IRD is still required. The timeline is usually 3–7 working days, and no government fee is charged for PAN registration.

For businesses, PAN registration enables tax compliance, access to banking services, and participation in commercial activities. Failure to register may lead to penalties and operational restrictions.

Medha Law & Partners, as a leading corporate law firm in Nepal, provides comprehensive legal and tax advisory services, assisting clients in Business PAN registration, VAT registration, tax filings, and full-spectrum corporate compliance.

Business PAN Registration Checklist – Nepal

FAQs

What is PAN used for in Nepal?
PAN is used to identify taxpayers and track income, expenses, and tax liabilities.

Who can apply for business PAN?
Any person or entity conducting business in Nepal can apply for PAN.

How long does PAN registration take?
It usually takes between 1 to 3 working days to get PAN.

Is PAN registration free in Nepal?
Yes, the government does not charge any fees for PAN registration.

Can I apply for PAN online?
Yes, businesses can apply online through the IRD’s official website.

What documents are needed for PAN?
Business registration, citizenship, photo, and office proof are required.

What if my PAN is delayed?
You may contact the IRD office or review the submitted documents again.

Which office registers business PAN?
The Inland Revenue Offices under IRD issue PAN to businesses.

Do I need a lawyer for PAN?
A lawyer is not mandatory but may assist in complex cases.

Is PAN mandatory for all businesses?
Yes, all commercial entities in Nepal must register for PAN.

Medha Law and Partners Is a leading law firm in Nepal.