VAT Registration
Register your business for Value Added Tax compliance in Nepal.
VAT Registration Guide Nepal 2026 (Value Added Tax)
1. Understanding the 2026 Thresholds
VAT is a consumption tax of 13% levied on the value added to goods and services. Registration is mandatory if your annual turnover exceeds these limits:
| Business Type | Mandatory Threshold (Annual) |
|---|---|
| Goods Only (Trading/Manufacturing) | NPR 50 Lakhs (5 Million) |
| Services Only (Consultancy/IT) | NPR 20 Lakhs (2 Million) |
| Mixed (Both Goods & Services) | NPR 20 Lakhs (2 Million) |
*Note: Importers and certain specific businesses (like Hardware, Liquor, or Electronics in urban areas) must register for VAT regardless of turnover.
2. Required Documents
- PAN Certificate: You must have a valid Business PAN first.
- Company Documents: Certificate of Incorporation, MOA, and AOA.
- Premises Proof: Rent agreement and a copy of the owner's citizenship.
- Business Sketch: A hand-drawn or digital map of your office/warehouse location.
- Bank Details: A letter from your bank confirming your business account.
- Signatory ID: Citizenship/Passport and photos of the authorized person.
3. Step-by-Step Registration Process
- Step 1: Online Application: Log in to the IRD Taxpayer Portal. Go to 'Registration' > 'Application for Registration' and select **VAT**.
- Step 2: Submission Number: Fill in the expected turnover and business category to generate a Submission Number.
- Step 3: Billing Declaration: You must declare whether you will use Pre-printed Tax Invoices or IRD-Approved Billing Software (e-billing).
- Step 4: Physical Verification: Visit your assigned Inland Revenue Office (IRO) with original documents. An officer may conduct a site visit to verify your office and signboard.
- Step 5: Certificate Issuance: Once approved, your VAT certificate is issued. Your VAT number will be the same as your 9-digit PAN.
4. Key Compliance Rules
- Monthly Filing: You must file your VAT return and pay the tax by the 25th day of the following month (Nepali Calendar).
- Nil Returns: Even if you have zero sales in a month, you must file a 'Nil' return to avoid a fine of NPR 1,000 per month.
- Display: The original VAT certificate must be framed and displayed prominently at your place of business.
5. Benefits of Voluntary Registration
Even if you are below the threshold, registering for VAT allows you to claim **Input Tax Credit**—meaning you can deduct the VAT you paid on your purchases from the VAT you collect on sales.
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