VAT Calculator Nepal

What is VAT?

Value Added Tax (VAT) is an indirect tax levied on the supply of goods and services at each stage of production and distribution. In Nepal, VAT was introduced in 1997 and is currently charged at 13% on most goods and services. It's administered by the Inland Revenue Department (IRD).

Who Needs to Register for VAT?

Mandatory Registration is required for:

• Businesses with annual turnover exceeding Rs. 50 lakhs (Rs. 5 million)
• Importers of goods
• Government contractors
• Entities dealing with VAT-registered businesses
• Specified business categories (regardless of turnover)

Voluntary Registration is available for businesses below the threshold.

Input VAT vs Output VAT

• Output VAT: VAT you charge on your sales to customers. This is collected from buyers and must be remitted to IRD.
• Input VAT: VAT you pay on your business purchases. This can be claimed as a credit against your Output VAT.
• Net VAT Payable: Output VAT - Input VAT = Amount to pay IRD (or refund if negative)

VAT Invoice Requirements

A valid VAT invoice must contain:

• Seller's name, address, and PAN number
• Buyer's name and PAN (if VAT registered)
• Invoice number and date
• Description of goods/services with HSN code
• Quantity, unit price, and total amount
• VAT amount shown separately
• Grand total (inclusive of VAT)

VAT Filing Deadlines

• Monthly Filers: By 25th of the following month
• Quarterly Filers: By end of the month following the quarter (for small businesses)
• Annual Return: Within 3 months of fiscal year end

Late filing attracts penalties and interest!