How Much Money is Required to Register a Company in Nepal?

1. Introduction to Company Registration in Nepal

Company registration in Nepal is regulated by the Office of the Company Registrar (OCR) under the Companies Act, 2063 (2006). Anyone intending to establish a company must adhere to the formal registration process governed by national laws. The registration requirement applies to both private and public limited companies. The government’s intent is to formalize businesses, ensure accountability, and maintain transparency in operations. Medha Law and Partners Is a Leading Corporate Law Firm in Nepal.

Nepal recognizes various business forms including private limited, public limited, non-profit companies, and foreign company branches. The monetary requirement for registration varies depending on the company type, share capital, number of shareholders, and legal service fees.

The total cost of registering a company involves:

• Government registration fee based on authorized capital.

• Legal consultation or service provider charges.

• Stamp duties and notary charges.

• Post-registration compliance costs.

The minimum registration expenses can range from NPR 9,000 to NPR 25,000 or more, depending on services obtained and company size. Understanding these expenses helps prospective business owners to plan their initial financial needs more accurately.

2. Types of Companies You Can Register

Under the Companies Act, 2063, the following company types are eligible for registration in Nepal:

• Private Limited Company
  Requires 1 to 50 shareholders. Not allowed to issue shares to the public.

• Public Limited Company
  Must have at least 7 shareholders. Can raise capital through public share offerings.

• Non-Profit Company (Not Distributing Profits)
  Established for social, educational, or charitable purposes. Profits cannot be distributed as dividends.

• Foreign Company Branch or Liaison Office
  Foreign entities may register a branch or liaison office under Section 154 of the Companies Act.

Each company type has different structural, legal, and financial implications. The cost of registration, compliance, and capital requirements differ as per the chosen company structure.

For example:

• Private limited companies are suitable for small to medium businesses.

• Public limited companies are ideal for businesses seeking public investment.

• Non-profits enjoy exemptions from certain taxes but must comply with NGO regulations.

• Foreign companies must provide additional documentation and pay higher fees.

3. Minimum Capital Requirement for Registration

The Companies Act does not mandate a fixed minimum paid-up capital for private limited companies. However, the minimum capital often starts from NPR 100,000 (One Lakh) to ensure the registration is processed smoothly. For public limited companies, the minimum paid-up capital must be NPR 10 million (1 Crore).

Foreign Investment and Technology Transfer Act, 2075 (2019) sets a minimum foreign investment threshold of NPR 20 million. This applies to wholly foreign-owned or joint-venture companies.

The capital influences:

• The government registration fee.

• Stamp duties.

• Business credibility and banking relationships.

While companies can declare higher authorized capital, only the paid-up portion must be deposited during incorporation. Entrepreneurs are advised to maintain transparency when declaring capital during registration.

4. Breakdown of Total Company Registration Cost

Company registration in Nepal consists of several cost elements. Here’s a detailed breakdown:

• Government Registration Fee (OCR)
  Based on the company’s authorized capital:

  • Up to NPR 100,000: NPR 1,000

  • NPR 100,001 to NPR 500,000: NPR 4,500

  • NPR 500,001 to NPR 2,500,000: NPR 9,500

  • NPR 2,500,001 to NPR 10,000,000: NPR 16,000

  • NPR 10,000,001 and above: NPR 19,000+

• Stamp Duty and Notary Fees
  Around NPR 1,000 to NPR 2,000

• Professional Service Charges (Legal/Consultant)
  Ranges between NPR 5,000 to NPR 15,000 depending on provider.

• PAN/VAT Registration
  Approx. NPR 1,000 to NPR 1,500

• MOA and AOA Drafting
  Included in legal service or separately billed (NPR 2,000–NPR 4,000)

In total, the estimated company registration cost ranges from NPR 9,000 to NPR 25,000+.

5. Government Fees for Company Registration Nepal

The OCR charges company registration fees according to the authorized share capital of the proposed company. The rates are standardized by the Government of Nepal Gazette.

Standard Government Fee Structure:

The fee must be paid during the submission of the application at OCR and is non-refundable. The fees are subject to revision by the Ministry of Industry, Commerce and Supplies.

6. Professional Service Charges for Registration Help

Most individuals and entities hire legal professionals or business consultants for a hassle-free registration process. These services usually include:

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

• Name reservation and availability check

• Preparation of shareholder agreements

• PAN registration

• Submission to OCR

Estimated Service Charges:

• Local law firms: NPR 5,000 – NPR 15,000

• High-end firms or foreign investor consultants: NPR 20,000+

While not mandatory, professional assistance ensures:

• Correct document formatting.

• Efficient handling of government queries.

• Avoidance of application rejection.

7. Required Documents for Company Registration Process

To register a company in Nepal, the following documents are required:

• Proposed name reservation form (online)

• Signed application for registration (Form A)

• MOA and AOA

• Copy of citizenship certificate of shareholders and directors

• Shareholder agreement (if any)

• Power of attorney (if hiring legal service)

• PAN registration application

• Lease agreement or ownership document for office space

For foreign companies:

• Copy of passport or business visa

• Board resolution for company formation

• Document certified by foreign authorities

All documents must be in Nepali or English, and notarized as per requirement. Submission is made both physically and via the OCR’s online portal.

8. Legal Compliance Costs Post Registration

After registration, several compliance obligations arise. These include:

• PAN/VAT Registration – NPR 1,000–NPR 1,500

• Social Security Fund Registration (for employees) – Free but mandatory

• Bank Account Opening – Initial deposit required

• Tax Filing Software Setup (if applicable) – NPR 5,000+

• Auditor Appointment and Annual Audit Fee – NPR 10,000–NPR 50,000 annually

• Annual Return Filing to OCR – NPR 2,000–NPR 5,000

Non-compliance may result in penalties or blacklisting. The Income Tax Act, 2058, and Companies Act, 2063, govern these requirements.

9. Timeline to Complete Company Registration Nepal

The average time required to complete company registration in Nepal is:

• Name Reservation – 1 to 2 working days

• Document Submission & Verification – 2 to 4 working days

• Certificate Issuance – 5 to 7 working days

Total estimated time: 7–10 working days.

However, delays can occur due to:

• Incomplete documentation.

• Name unavailability.

• Technical issues with OCR’s online system.

Hiring a professional may reduce delays and expedite the process.

10. Office Address and Infrastructure Cost

A registered office address is compulsory for company registration. This is where the business operates and receives official correspondence.

Office Setup Costs:

• Rental Deposit – 1–2 months’ advance

• Monthly Rent (Kathmandu) – NPR 10,000–NPR 50,000

• Furnishing and Utilities – NPR 20,000+ (initial)

The address must be supported by:

• Lease Agreement or

• Ownership Document and

• Utility Bill in the name of the lessor

The OCR may inspect the office location in case of verification or for VAT registration.

11. Share Capital and its Financial Impact

Share capital is the amount invested by shareholders in exchange for shares. It consists of:

• Authorized Capital – Maximum capital permitted

• Issued Capital – Portion offered to investors

• Paid-Up Capital – Actual money received

Higher capital:

• Increases company credibility

• Attracts investment

• Involves higher registration fees

Lower capital:

• Minimizes initial financial strain

• Limits investor attraction

The amount must be reflected in the MOA. Investors must deposit the capital in a company bank account, and proof may be required during inspections.

12. Company Registration Checklist with Expenses

Pre-Registration:

• Choose company name

• Decide authorized and paid-up capital

• Prepare MOA and AOA

• Gather shareholder documents

Expenses Checklist:

• OCR Registration Fee: NPR 1,000–19,000+

• Legal Drafting: NPR 2,000–4,000

• Consultant Fees: NPR 5,000–15,000

• Notary Charges: NPR 500–1,000

• Stamp Duty: NPR 500–1,500

• PAN: NPR 1,000–1,500

Keeping these expenses in view helps entrepreneurs stay financially prepared.

13. Key Authorities Involved in Registration Process

The following authorities oversee company registration and compliance in Nepal:

• Office of the Company Registrar (OCR)
  Primary registration body under the Ministry of Industry.

• Inland Revenue Department (IRD)
  Handles PAN/VAT registration and tax matters.

• Nepal Rastra Bank (NRB)
  Approves foreign investment and currency regulation.

• Social Security Fund (SSF)
  For employee benefits registration.

• Local Ward Office
  Issues rental agreements and address verifications.

Each authority plays a role in ensuring the legality and sustainability of the business.

14. Laws Regulating Company Incorporation in Nepal

Company formation is governed by multiple national laws:

• Companies Act, 2063 (2006)
  Primary law governing incorporation, responsibilities, and dissolution.

• Income Tax Act, 2058 (2002)
  Governs tax registration and liabilities.

• Foreign Investment and Technology Transfer Act, 2075 (2019)
  Regulates foreign investor involvement.

• Labor Act, 2074 (2017)
  Outlines hiring, wages, and employee benefits.

• Industrial Enterprises Act, 2076
  Provides incentives for industrial registration.

Understanding and following these laws ensures smooth operations.

15. Summary of All Required Registration Expenses

Total Estimate: NPR 9,000 – NPR 50,000+

The final amount depends on company type, capital, location, and chosen services.

FAQs

How much is the registration fee?

The registration fee ranges from NPR 1,000 to NPR 19,000+ based on the authorized share capital of the company.

Is there a minimum capital needed?

For private companies, there is no legal minimum, but NPR 100,000 is commonly used. Public companies require NPR 10 million.

Do I need a lawyer to register?

It is not mandatory, but hiring one ensures accuracy in documentation and reduces chances of rejection.

How long does registration take?

On average, company registration in Nepal takes 7 to 10 working days if documents are complete.

Can I register a company online?

Yes, the OCR portal allows online name reservation and registration submissions.

What documents are mandatory?

Key documents include MOA, AOA, citizenship certificates, and proof of office address.

What is the role of OCR Nepal?

OCR handles company registration, amendments, and maintains records of companies.

Do I pay taxes during registration?

No tax is paid during registration. Taxes apply after business operations begin.

Are there hidden charges involved?

If done personally, no. Legal and consultant fees vary based on services chosen.

Can foreigners register companies in Nepal?

Yes, subject to minimum investment laws and foreign company documentation requirements.