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INVESTMENT GUIDE

Investment guide

The matters worth confirming first about foreign investment into Nepal, written so it can be circulated internally.

AT A GLANCE

The regime at a glance

  • NPR 20M

    Minimum foreign investment

    c.USD 150,000. Reduced from NPR 50 million via the FY2022/23 budget. IT and export-oriented companies are currently exempt from the threshold.

    Source：Ministry of Finance, Nepal; law-firm commentarysince the FY2022/23 budget

  • 100%

    Permitted foreign ownership

    Under FITTA 2019 (Foreign Investment and Technology Transfer Act, 2075), full ownership is permitted outside negative-list sectors.

    Source：FITTA 2075 (2019)in force since 2019

  • 25%

    Standard corporate tax rate

    30% for banks, financial institutions and insurers; 20% for manufacturing and certain BOOT infrastructure projects.

    Source：Inland Revenue Department, Nepalcurrent

  • 5%

    Withholding tax on repatriated dividends

    FITTA §8 places no restriction on repatriating after-tax profit, capital, or capital gains. Repatriated dividends carry a 5% withholding tax.

    Source：FITTA 2075, §8current

  • NPR 2B

    Threshold for Investment Board Nepal

    Foreign-investment projects above NPR 2bn sit with IBN. Below that, the Department of Industry is the counterparty, which is the route most Japanese SME and mid-cap projects actually take.

    Source：Investment Board NepalInvestment Board Act 2068 (2011)

  • 3–6 weeks

    Indicative timeline to incorporate a foreign-invested entity

    A wholly Nepali-owned private company takes roughly 7–15 working days. Foreign investment adds FITTA approval and Nepal Rastra Bank registration, which can extend the process to 2–3 months depending on sector and documentation. Treat this as an indicative range, not a commitment.

    Source：Practitioner commentaryas of August 2026

LEGAL FRAMEWORK

The governing law, and who you file with

Foreign investment is governed by the Foreign Investment and Technology Transfer Act (FITTA 2075 / 2019). Outside negative-list sectors, 100% foreign ownership is permitted. Repatriation of profit, capital and capital gains on share sale is provided for in §8 of the same Act.

Your counterparty depends on deal size. Foreign investment above NPR 2 billion sits with Investment Board Nepal (IBN); below that, the Department of Industry (DoI) is the filing authority. Most Japanese SME and mid-cap projects fall on the DoI route. Establishing which side of that line you are on changes the sequence of everything that follows.

Company registration goes through the Office of Company Registrar (OCR), and Nepal Rastra Bank (NRB) is involved in registering the investment and the inbound capital.

PROCESS

The sequence

The real order of operations, and the main preparation each step requires. Durations depend on sector and on documentation readiness.
  1. 01

    Confirm the sector

    Check that the activity is not on the negative list, and identify any sector-specific licences required.

  2. 02

    Fix the investment amount and shareholding

    Threshold requirements, ownership split, and the route the funds will travel. IT and export-oriented companies are exempt from the minimum.

  3. 03

    Apply for FITTA approval

    Filed with DoI or IBN depending on size. A business plan, proof of funds and draft constitutional documents are typically required.

  4. 04

    Register the company (OCR)

    Name reservation, memorandum and articles, registration. A wholly Nepali-owned company takes 7–15 working days; foreign investment requires the prior approval above.

  5. 05

    Tax registration and PAN

    Registration with the Inland Revenue Department.

  6. 06

    NRB registration and capital inflow

    Register the foreign investment and remit capital through the formal channel. This record is what later repatriation depends on.

  7. 07

    Banking, premises, visas

    Corporate account, office, and visas for any assigned staff.

  8. 08

    Operations and ongoing compliance

    Accounting and tax, labour compliance, and periodic renewals continue indefinitely.

TALENT

The Japanese-side visa regime

Nepal is one of Japan's principal sources of foreign workers. The Japanese residency framework is currently mid-transition, so precision matters here.

Specified Skilled Worker (特定技能) is the system in force. The list of designated industry fields keeps expanding; a further addition was made by cabinet decision in January 2026. Because the field count has changed more than once in a short period, confirm the current list with the Immigration Services Agency when building a hiring plan.

The Technical Intern Training programme (技能実習) is being abolished and replaced by Employment for Skill Development (育成就労), created by the 2024 legislative amendment and scheduled to commence on 1 April 2027. The substantive change is that the stated purpose shifts from technology transfer as international contribution to workforce development and workforce securing. Progression from the new status into Specified Skilled Worker (i) is expected to require both a skills examination and Japanese-language ability at roughly A2 level.

Separately, since July 2025 Nepal requires demand letters to be authenticated through its embassy in Japan for Specified Skilled Worker hiring, which in practice makes routing through a government-recognised sending organisation the advisable path.

This area is legislatively active. The above reflects our understanding as of August 2026; confirm against the Immigration Services Agency and MHLW before finalising a hiring plan.

FAQ

Frequently asked questions

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This site provides general information only and is not legal, tax or investment advice. Regulations change. Please confirm against current primary sources and with your own advisers before acting.

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