Registering a company in Nepal is only the beginning. Once a company is registered with the Office of the Company Registrar (OCR), it has continuing legal, accounting and tax compliance responsibilities.

Many small businesses assume that once the company registration certificate and PAN are obtained, there is nothing more to do until the business becomes profitable. This is not the case. Even an inactive or low-turnover company may have annual compliance obligations.

This guide explains the major yearly company compliance requirements in Nepal, what needs to be submitted to OCR and IRD, and the approximate cost of maintaining a company in compliance.

What Is Company Annual Compliance in Nepal?

Company annual compliance refers to the regular legal, accounting and tax-related obligations that a registered company needs to complete every financial year.

The main authorities involved are:

• Office of the Company Registrar (OCR) – corporate and company-related compliance
• Inland Revenue Department (IRD) – income tax, VAT and TDS compliance
• Local government/Ward Office – applicable business registration or renewal requirements
• Other regulators – depending on the nature of the business

It is important to understand that OCR compliance and tax compliance are not the same thing.

A company may complete its OCR annual filing but still have outstanding income tax, VAT or TDS obligations.

Major Yearly Compliance Requirements for a Nepalese Company

1. Prepare Annual Financial Statements

A company needs to maintain proper accounting records and prepare annual financial statements.

These may include:

• Balance sheet
• Profit and loss statement
• Cash flow statement
• Supporting schedules and accounting records

The Office of Company Registrar states that companies are required to maintain proper accounts using a double-entry accounting system and prepare annual financial statements according to applicable requirements.

For a private company, the annual financial statements are required to be prepared within six months after the end of the financial year.

2. Annual Audit

A registered company must have its annual accounts audited by an appropriately registered auditor.

The audited financial statements and audit report form an important part of the company’s annual compliance.

The OCR states that companies are required to have their annual accounts audited and submit the audit report along with the required annual financial information.

The cost of an audit depends heavily on the size and complexity of the business. A company with only a few transactions will generally have a much lower audit fee than a company with significant turnover, inventory, employees or multiple transactions.

3. Annual Return and Filing With OCR

Companies are required to submit the required annual information and financial documents to the Office of Company Registrar.

For a private company, the audited annual financial statements need to be submitted within six months after completion of the financial year.

The information submitted can include details relating to:

• Shareholders
• Directors
• Share capital
• Annual financial statements
• Auditor
• Company changes
• Other information required under the Companies Act

Keeping the company’s information updated is important, particularly when there has been a change in directors, shareholders, registered office, capital or other company particulars.

4. Annual General Meeting (AGM)

Companies also have obligations relating to general meetings.

For public companies, the OCR states that the AGM must generally be held within six months after the end of the financial year. Private companies follow the provisions of their articles/rules regarding general meetings, subject to the Companies Act.

The AGM and company minutes should be properly documented and maintained.

5. Appointment of Auditor

A company needs to appoint an auditor for its annual accounts.

The auditor’s appointment and related information must be handled according to the Companies Act and the company’s governing documents. The OCR notes that the auditor’s name is to be communicated to the Office within the prescribed period.

6. Annual Income Tax Return

OCR compliance does not replace income tax compliance.

A company also needs to meet its obligations with the Inland Revenue Department.

Under Nepal’s Income Tax Act, an income return is generally required within three months after the end of the income year, subject to applicable provisions and exceptions.

The tax return should be prepared based on the company’s accounts and audited financial information.

7. VAT Compliance

If the company is VAT registered, it has additional VAT obligations.

Depending on the applicable filing period, the company needs to:

• Maintain sales records
• Maintain purchase records
• Calculate output and eligible input VAT
• File VAT returns
• Pay VAT, where applicable
• Maintain supporting invoices and records

VAT compliance is separate from the annual OCR filing.

8. TDS Compliance

Companies making payments that are subject to tax deduction at source may also have regular TDS obligations.

For example, TDS may become relevant for certain:

• Salary payments
• Professional/service payments
• Rent
• Contract payments
• Other payments covered by tax rules

Therefore, even a small company should review its TDS obligations rather than assuming that no TDS filing is required.

What Happens If a Company Does Not Complete Annual Compliance?

Ignoring company compliance can result in penalties and an accumulation of outstanding obligations.

Under Section 81 of the Companies Act, penalties for failure to submit required information vary according to the company’s paid-up capital and the period of delay.

For example, the OCR’s published penalty schedule provides progressively higher penalties for companies with paid-up capital up to Rs. 25 lakh, up to Rs. 1 crore, and above Rs. 1 crore. After the specified periods, penalties can continue on an annual basis.

Therefore, having no business transactions does not necessarily mean that a company can simply ignore its compliance requirements.

An inactive company should also review its outstanding OCR and tax obligations.

How Much Does Company Annual Compliance Cost in Nepal?

The total cost depends on what you include under “annual compliance.”

There are usually three different components:

1. Government fees and penalties

These are paid to the relevant government authority and depend on the type of filing, company details and applicable rules.

2. Audit fee

The audit fee is paid to the auditor and varies according to:

• Turnover
• Number of transactions
• Accounting records
• Inventory
• Employees
• VAT status
• Complexity of the business

3. Accountant/Compliance Professional Fee

This is the fee charged by an accountant, tax consultant or compliance service provider for preparing accounts, coordinating the audit and completing the required filings.

Current publicly advertised market prices show significant variation. For example, some providers advertise OCR annual-return services around Rs. 5,000–10,000, while broader annual compliance packages can cost Rs. 20,000–25,000 or more, depending on the scope.

Indicative Annual Compliance Pricing

Audit fees, government fees, VAT/TDS work and penalties may be charged separately depending on the package.

These are indicative professional-market prices rather than government-fixed fees.

What Does a Complete Annual Compliance Package Include?

A business owner may prefer to outsource the entire compliance cycle instead of separately hiring someone for each task.

A comprehensive package can include:

• Annual bookkeeping review
• Preparation of financial statements
• Coordination with auditor
• Audit-related documentation
• OCR annual filing
• Annual income tax return
• VAT compliance, if applicable
• TDS compliance, if applicable
• Company information updates
• Compliance deadline reminders
• Maintenance of statutory documents

This approach can be particularly useful for small and medium-sized companies that do not have a full-time accountant.

Suggested Annual Compliance Package for Small Companies

For a small private limited company with relatively simple transactions, a practical package could be structured as:

Basic OCR Compliance — Rs. 8,000–10,000

Includes:

• OCR annual filing
• Review of basic company information
• Annual compliance documentation
• Filing confirmation

OCR + Tax Compliance — Rs. 15,000–20,000

Includes:

• OCR annual filing
• Annual income tax return
• Basic compliance review
• Coordination for required documents

Complete Annual Compliance — Rs. 20,000–30,000+

Includes:

• Accounts review
• Financial statement preparation support
• OCR annual filing
• Income tax return
• VAT/TDS compliance where applicable
• Compliance documentation
• Annual compliance reminder

Audit fees and government charges can be kept separate so that the client clearly understands what they are paying for.

Documents Generally Required for Annual Compliance

A company should keep the following records ready:

• Company registration certificate
• PAN/VAT certificate
• Previous year’s audited financial statements
• Current year’s accounting records
• Bank statements
• Sales invoices
• Purchase invoices
• Expense records
• Fixed asset records
• Loan information
• Shareholder details
• Director details
• Previous OCR filings
• Tax filing records
• VAT/TDS records, where applicable

The exact documents required will depend on the company’s activities and compliance status.

OCR Compliance Checklist for Nepalese Companies

Before considering the annual compliance cycle complete, check:

• Accounting records are updated
• Annual financial statements are prepared
• Annual accounts are audited
• Auditor appointment/details are properly handled
• AGM/general meeting requirements are completed
• OCR annual documents are submitted
• Shareholder and director information is updated
• Company address and other particulars are updated if changed
• Annual income tax return is filed
• VAT returns are filed, if applicable
• TDS obligations are completed, if applicable
• Local business renewal requirements are checked
• All filing receipts and supporting documents are retained

Why Outsource Company Annual Compliance?

Annual compliance involves more than simply submitting an online form.

A professional can help ensure that:

Accounts → Audit → OCR filing → Tax filing → VAT/TDS → Records

are properly coordinated.

This can save business owners time and reduce the risk of missing deadlines or accumulating penalties.

For small companies, outsourcing can also be more economical than maintaining a full-time accountant for work that is primarily annual or periodic.

Company Annual Compliance Service in Nepal

If you own a private limited company in Nepal and need help maintaining your yearly compliance, professional accounting support can cover the process from accounts preparation and audit coordination to OCR and IRD filing.

A small company with straightforward transactions may typically budget around Rs. 15,000–30,000 for professional annual compliance services, excluding statutory audit fees, government charges, VAT/TDS work outside the agreed scope and any penalties or overdue compliance.

The final price should be based on the company’s transaction volume, turnover, VAT/TDS status, number of shareholders/directors and whether previous years’ compliance is up to date.

Need help with Company Registrar (OCR) annual compliance in Nepal? Contact an accounting professional to review your company’s current compliance status and get a package based on your actual requirements.

Disclaimer: Government fees, penalties and compliance requirements can change. The latest requirements should be verified with the Office of Company Registrar and Inland Revenue Department before filing. Professional service fees are market-based and vary between providers.