Rectifying VAT Return in Nepal Using “Anya Thapghat (अन्य थपघट) It’s common for businesses in Nepal to make small mistakes while filing VAT returns — like entering a higher or lower purchase or sales amount. The good news is, you don’t need to panic or re-file the old return. The IRD allows you to correct such errors easily through the “Anya Thapghat” section in your next VAT return. What Is “Anya Thapghat”? अन्य थपघट (Anya Thapghat) means Other Adjustments (Increase/Decrease).It’s the part of the VAT return form where you can fix errors from previous months — for example: How to Rectify Your VAT Return Quick Tips Final Note The Anya Thapghat option is the official and easy way to fix VAT errors in Nepal. It keeps your records accurate, avoids penalties, and shows good compliance with the IRD’s system. For more guidance or expert help with VAT return correction, consult Sharkvision Expert — your trusted partner for tax, accounting, and compliance solutions in Nepal.
Top 5 Tax Facts Every Nepali Entrepreneur Should Know(Guide)
Starting and running a business in Nepal is exciting — but managing taxes can often feel complicated. Whether you’re a small business owner or an emerging startup, understanding the basic tax laws in Nepal can save you both time and money. While complex tax issues should always be handled by professional accountants or tax consultants, having a clear idea of key tax obligations helps you make better business decisions and stay compliant with the Inland Revenue Department (IRD). Here are the five most important tax facts every entrepreneur in Nepal should know in 2025 1. Advance Tax in Nepal If your estimated annual tax liability (after adjusting for withholding tax) is Rs. 5,000 or more, you’re required to pay advance tax. Installment Schedule (as per IRD Nepal): The total estimated tax should be at least 90% of the actual tax payable for the year.Missing the deadline can result in 15% per annum interest under Section 118 of the Income Tax Act, 2058. 2. Withholding Tax (TDS) in Nepal Withholding Tax (TDS) means tax deducted at the source — the payer deducts tax from payments and remits it to the IRD. Under Sections 87–89 of the Income Tax Act, 2058, resident payers must withhold tax on certain payments made within Nepal. Type of Payment Tax Rate Salary As per slab rate Services (VAT invoice) 1.5% Services (without VAT invoice) 15% Interest (Bank to Individual) 5% Rent 10% Contract Payments (> Rs. 50,000 within 10 days) 1.5% Dividend 5% Insurance Investment Gain 5% Unapproved Retirement Fund Gain 5% Proper TDS deduction ensures compliance and prevents penalties during audits. 3. Filing Income Tax Return in Nepal As per Section 99 of the Income Tax Act, businesses must file their income tax return within 3 months from the end of the income year. 🔹 Extension: You can request up to 3 more months by submitting a written application to the IRD before the deadline. 🔹 Penalty for Late Filing (Section 117): Filing returns on time improves your business credibility and is essential for future loan approvals or government registrations. 4. Income Tax Rates in Nepal (2025) Tax rates are specified under Schedule 1 of the Income Tax Act, 2058. For Individuals (Natural Persons): Progressive rates apply based on income brackets.(Example: lower rates for lower income, higher rates for higher income.) For Businesses (Entities): A flat 25% tax rate generally applies unless your business qualifies for special rates (e.g., banking, insurance, or export-oriented businesses). 5. Value Added Tax (VAT) in Nepal VAT is charged at 13% on the sale of taxable goods and services.Registered businesses can claim input tax credit — meaning VAT paid on purchases can be adjusted against VAT collected on sales. VAT Return & Payment Deadline:Submit VAT returns and pay VAT within 25 days after the end of each month or trimester, depending on your filing type. Failure to file or pay VAT on time can result in fines and interest charges from the IRD. Final Thoughts Understanding Nepal’s tax system helps entrepreneurs make better financial decisions and stay compliant. Paying advance tax on time, deducting TDS correctly, and filing returns regularly ensures your business runs smoothly without legal hassles. At Shark Vision Consulting, we help entrepreneurs and businesses in Nepal with: 📞 Contact Shark Vision Consulting today for reliable tax advice and compliance solutions tailored to your business.
Misutilization of Business Loan in Nepal: What Every Proprietor Must Know
Running a business requires capital — and for many proprietors, business loans are the fuel that keeps the engine running. But what happens when those funds are used for purposes other than what they were approved for? In Nepal, misutilization of business loans is not just a financial mistake — it’s a legal offense that can lead to fines, imprisonment, and blacklisting. This article explains everything you need to know about loan misuse, its legal implications, and how to avoid falling into this trap. What Is Misutilization of a Business Loan? Misutilization means using the loan amount for purposes other than what it was sanctioned for.For example: In the case of a proprietorship, the owner and the business are legally the same person. So, using business funds for personal needs is considered direct misutilization of the loan. Legal Provisions in Nepal Nepal has strong laws that regulate how borrowed money should be used. Two key legislations apply in cases of loan misuse: 1. Income Tax Act, 2058 (2002) While the Act doesn’t directly define “loan misutilization,” it includes provisions that become relevant when a business loan is used improperly. 2. Banking Offense and Punishment Act, 2064 (2008) This Act directly deals with banking and loan misuse. Penalties for Misutilization of Business Loan According to Section 15 of the Banking Offense and Punishment Act, 2064: In some cases, both imprisonment and fine can be imposed together. Additional Consequences Why It Matters for Proprietorship Businesses In a proprietorship, there’s no legal separation between the owner and the business.That means: Hence, even minor misuse can put personal assets at risk. How to Stay Compliant Here are practical steps to avoid legal and financial trouble: Final Thoughts Misutilization of a business loan might seem minor at first, but under Nepalese law, it carries serious legal and financial consequences. For proprietors, the line between personal and business use must always remain clear. At Shark Vision Consulting, we help business owners stay compliant, manage their finances responsibly, and avoid legal risks associated with loan misuse. Remember — borrowing is a privilege; proper utilization is a responsibility
ATTENTION:Notice regarding providing tax relief, facilities, and exemptions !!!
According to the authority granted by sub-section (1) of section 18 of the Finance Act, 2082, published in the Nepal Gazette dated Ashoj 10, 2082, the Government of Nepal has formed a Tax Facilitation Committee. (a) Any person who has contributed to the National Reconstruction Fund established by the Government of Nepal in the fiscal year 2082/083 or to any other similar fund established by the Government for reconstruction purposes, and (b) any person, industry, trade, or business enterprise whose property, business, or commercial infrastructure has been damaged or destroyed, or whose business has suffered due to the “Generation-G” protest or related disturbances, and whose stock or goods were not insured, may submit the relevant details and documents to the concerned Inland Revenue Office. Upon verification, the Tax Facilitation Committee formed under the Finance Act, 2082, will examine the application and, if deemed appropriate, provide tax relief, facilities, and exemptions to such taxpayers. All taxpayers are hereby informed that such facilities will be made available to the affected and eligible taxpayers, and all concerned are notified accordingly through this notice.
Avoid These 7 Common Financial Mistakes Small Businesses Still Make in Nepal
Running a small business is exciting, rewarding—and often overwhelming. Amid all the moving parts, financial management is an area where small missteps can have lasting impacts. At SharkVision, we’ve seen firsthand how avoidable financial mistakes can derail growth, affect cash flow, and invite unnecessary stress.
