Nepal tax guide

How to file a VAT return in Nepal: the monthly Annex 10, step by step

Last checked 27 October 2026 (10 Kartik 2083). By Black Rock, the maker of BRAccount.

A VAT-registered business in Nepal files a return for every Bikram Sambat month within 25 days of the month's end, nil months included, and pays the VAT with it (VAT Act sections 18 and 19). The form is Annex 10 of the VAT Rules (अनुसूची-१०), filed on the IRD's Taxpayer Portal: sales and purchases by kind, the VAT charged, the input credit, the reverse-charge VAT, the credit carried forward, and the tax to pay or the refund to claim. This guide walks through the dates, the books the figures come from, the form box by box, the payment, amendments, refunds, and the fees and interest for being late.

The short version

Due: within 25 days of the end of each Nepali month, with the payment; a month with no sales is still filed as a nil return. Shrawan's return is due by 25 Bhadra; Kartik 2083's by 25 Mangsir 2083 (11 December 2026).
Four-monthly returns are allowed by the IRD's leave for print and electronic media and for businesses with turnover up to Rs 1 crore a year (Rules r26).
The form, Annex 10, has three columns, transaction value, credit and debit, and boxes for taxable, export and exempt sales, taxable and exempt purchases and imports, other adjustments, the credit brought forward, the tax payable and the refund claimed, in whole rupees.
VAT above Rs 10 lakh is paid by cheque, draft or electronic transfer; an electronic payment counts on the day it is ordered. A return filed on time may be amended within 7 days (Finance Act 2083).
Late payment: an additional fee of 10% a year plus interest of 15% a year, counted by the month. Late filing: 0.05% of the tax a day or Rs 1,000, whichever is higher. Four months overdue stops imports and exports; six months publishes the name, freezes the credit and suspends the registration; twelve months cancels it.
Excess credit is carried forward; a refund can be claimed after four months running, or monthly by an exporter whose exports pass 40% of sales.

When is the VAT return due?

Return period: Each Bikram Sambat month; four-monthly by the IRD's leave for print and electronic media and for turnover up to Rs 1 crore a yearVAT Act s18(1), Rules r26
Due date: Within 25 days of the end of the period, with the payment, nil returns includeds18(1), s19(1)
Districts without an Inland Revenue Office: By the 15th of the month, at the local level or the treasury offices18(1a)
Amending a return: A return filed on time may be amended within 7 days of filings18(4) (Finance Act 2083)
Format: Annex 10 of the Rules, in whole rupees, on the Taxpayer Portalr26(1)

The 25 days run from the end of the Nepali month, not the English one: Kartik 2083 ends on 16 November 2026, so its return and payment are due by 25 Mangsir 2083, 11 December 2026. Every month's date for 2083/84 is in the Nepal tax calendar.

What you need before you file

The return is a summary of books the Rules already require (r23 to r25), so the work is in agreeing them first:

The sales book (Annex 9) for the month: every tax invoice and abbreviated invoice issued, with exempt, taxable and export sales and the VAT on each, and the credit notes against them.
The purchase book (Annex 8): every supplier's tax invoice and every customs declaration, with the exempt and taxable purchases and imports, the input VAT, and the debit notes.
The monthly VAT account (Annex 7), which should agree with the two books and with the VAT payable and receivable accounts in the ledger.
Credit and debit notes issued and received (r20), which go into the adjustments.
Services bought from abroad or from unregistered transport and vehicle-hire providers, on which the business charges itself VAT under the reverse charge (s8(2), (2a)).
For a business connected to CBMS, the sync log and the Annex 5 Standard View: the return should not be filed with bills still unsent.

Input credit belongs in the return only on a full tax invoice dated within the last year, once per invoice (r39); not on an abbreviated invoice, not on drinks, liquor, petrol for vehicles or entertainment, and only 40% on a passenger vehicle (r41). Inputs used for both taxable and exempt sales are credited in the share of taxable sales (r40). The tax invoice guide covers what makes an invoice valid.

The Annex 10 form, box by box

Annex 10 has three columns, transaction value, credit and debit, and these boxes:

Box	What goes in it
1.1 Taxable sales	Sales at 13% and 5%, with the VAT charged in the debit column
1.2 Exports	Zero-rated sales with their customs proof; no VAT
1.3 Exempt sales	Schedule 1 goods and services; no VAT and no credit on their inputs
2.1 Taxable purchases	Local purchases on full tax invoices, with the input VAT in the credit column
2.2 Taxable imports	Imports on customs declarations, with the VAT paid at customs
2.3 Exempt purchases, 2.4 Exempt imports	Purchases and imports that carried no VAT
3.1 Other adjustments	The reverse-charge VAT on imported services (both charged and, for a registered buyer, credited), a tax officer's credit or debit advices, and credit and debit notes
4 Total, 5 Debit less credit	The VAT charged less the VAT credited for the month
6 Credit carried from the last return	Excess credit brought forward
7 Tax payable	Box 5 less box 6; a negative figure carries forward
8 Refund claimed, 9 its basis	A refund claim after four months of carried-forward credit, or an exporter's monthly claim
10 The payment and its voucher	How and when the tax was paid
11 Document counts	The number of purchase invoices, credit notes, debit notes, credit advices, debit advices and sales invoices used in the period

Figures are in whole rupees (r26(1)).

Working out the tax: output, input and the reverse charge

VAT payable for the month is the VAT charged on taxable sales (output VAT) less the VAT credited on purchases and imports used in the taxable business (input VAT), after the adjustments. A reverse charge on a service bought from abroad adds 13% of the price to the output side at the earlier of paying and receiving the service (s8(2)); a registered buyer credits the same amount on the input side (s17(5b)), so for a fully taxable business the two cancel and only the declaration remains.

A worked month: sales of Rs 10,00,000 at 13% give output VAT of Rs 1,30,000; purchases of Rs 6,00,000 on full tax invoices give input VAT of Rs 78,000; a Rs 20,000 software subscription from abroad adds Rs 2,600 of reverse-charge VAT to both sides. VAT payable is Rs 1,30,000 + Rs 2,600 − Rs 78,000 − Rs 2,600 = Rs 52,000. If last month's return carried Rs 10,000 of excess credit forward, Rs 42,000 is paid.

How to file, step by step

Close the month's books: agree the sales book, the purchase book and the VAT account with the ledger, and check that every credit and debit note is in.
Sign in to the IRD's Taxpayer Portal with the PAN's user ID and password, and open the VAT return for the period.
Enter the Annex 10 boxes from the books: sales by kind, purchases and imports by kind, the adjustments, the credit brought forward.
Check the tax payable, submit the return, and keep the submission reference the portal gives.
Pay the tax within the same 25 days: tax above Rs 10 lakh by cheque, draft or electronic transfer; an electronic payment counts on the day it is ordered (s19(7), (7a)). Record the voucher in box 10.
Keep the filed return and the payment proof with the month's books, for six years (r23(4)).
Found an error within 7 days of filing on time? Amend the return on the portal (s18(4)). After that, the correction goes through a later return's adjustments or the tax office.

The portal's screens change without notice; the boxes and the dates are the law's and do not.

Nil returns and four-monthly returns

A registered business files every period whether or not it traded: a month with no sales and no purchases is filed as a nil return, and twelve months of nil or missing returns are a ground for cancelling the registration (s11(1)(e)). Print and electronic media, and businesses with turnover up to Rs 1 crore a year, may file four-monthly with the IRD's leave (r26); the due date is still 25 days after the period ends.

Excess credit and refunds

Excess credit first settles other VAT dues and is then carried forward month to month (s24(1)).
A refund may be claimed after four months running of carried-forward credit, or in any month in which exports pass 40% of the month's sales (s24(2)-(3), r39(4)-(5)).
The IRD refunds within 60 days of a four-month claim and 30 days of an exporter's; later than that it pays 15% a year interest (s24, r47).
A refund above Rs 20,000 is paid only into the claimant's bank account (r45); refund claims lapse three years after the end of the tax period (s25D).
Government bodies and government-owned companies paying a contractor deposit 30% of the VAT directly in the supplier's name; the supplier counts it against its own VAT (s25C1, r6ग).

What a late return or late payment costs

Breach	What it costs	Section
Tax paid late	An additional fee of 10% a year plus interest of 15% a year on the tax, from the due date; counted by the month at a twelfth of each rate, a part month as a month; interest runs during review and appeal	s19(2), s26, Rules r29(3)
Return filed late or not at all	0.05% of the tax a day, or Rs 1,000 a period, whichever is higher	s29(1)(h)
Returns four months overdue	The business's imports and exports can be stopped	s18(3)
Six months running without a return	The name is published, the credit is frozen and the registration suspended	s30(2)
Twelve months of nil or missing returns	The registration is cancelled	s11(1)(e)

A worked example: Rs 1,00,000 of VAT paid 73 days after the due date is three months (two whole and a part): an additional fee of Rs 2,500 and interest of Rs 3,750. The return filed ten days late adds Rs 1,000, because 0.05% × 10 days × Rs 1,00,000 = Rs 500 is less than the minimum. The Director General may waive the additional fee for reasons beyond the taxpayer's control (s19(4)); the Finance Act 2083's amnesty waives interest, fees and fines on arrears paid with 1% by the end of Poush 2083 (14 January 2027). More in penalties and appeals.

How BRAccount builds the return

BRAccount's IRD VAT Return report takes the chosen Nepali month and builds the Annex 10 figures from the submitted sales and purchase invoices, the credit and debit notes and the reverse-charge entries, in the form's own boxes, beside the IRD sales book, purchase book and the two VAT ledgers it should agree with. It shows the month's due date and the late fee and interest if the date has passed, and the Monthly Close checks that no bill is left unsent to CBMS before the figures are typed into the portal and the payment recorded. The VAT guide covers the rates, registration and credit rules behind the figures.

Questions

When is the VAT return due in Nepal?

Within 25 days of the end of each Nepali (Bikram Sambat) month, with the tax (VAT Act s18, s19). Shrawan's return is due by 25 Bhadra; Kartik 2083's by 25 Mangsir 2083, which is 11 December 2026.

Do I have to file a VAT return if I had no sales?

Yes. A month with no sales or purchases is filed as a nil return by the same date. Twelve months of nil or missing returns are a ground for cancelling the registration.

What is Annex 10 (अनुसूची-१०)?

The VAT return form in the VAT Rules: three columns (transaction value, credit, debit) and boxes for taxable, export and exempt sales, taxable and exempt purchases and imports, other adjustments, the credit brought forward, the tax payable, the refund claimed, the payment and the document counts, in whole rupees.

How is the VAT payable worked out?

The VAT charged on taxable sales less the VAT credited on purchases and imports used in the taxable business, after the adjustments (credit and debit notes, the reverse charge), less any credit carried from the previous return. A negative result carries forward.

Can I correct a VAT return after filing it?

A return filed on time may be amended within 7 days of filing (s18(4), Finance Act 2083). After that, the correction goes through a later return's adjustments or the tax office.

What is the penalty for filing a VAT return late?

0.05% of the tax for each day late, or Rs 1,000 a period, whichever is higher (s29(1)(h)). Four months overdue can stop imports and exports; six months running publishes the name, freezes the credit and suspends the registration.

What does paying VAT late cost?

An additional fee of 10% a year plus interest of 15% a year on the tax, counted by the month from the due date, with a part month as a month (s19(2), s26). Rs 1,00,000 paid 73 days late costs Rs 2,500 in fee and Rs 3,750 in interest.

How do I pay the VAT?

With the return, within the 25 days. Tax above Rs 10 lakh is paid by cheque, draft or electronic transfer, and an electronic payment counts on the day it is ordered (s19(7), (7a)). The voucher goes in box 10 of the return.

Can I file VAT returns every four months instead of monthly?

Print and electronic media, and businesses with turnover up to Rs 1 crore a year, may file four-monthly with the IRD's leave (Rules r26). Everyone else files monthly.

How do I claim a VAT refund?

Through the return, after four months running of carried-forward credit, or in any month in which exports pass 40% of sales. The IRD refunds within 60 or 30 days, into a bank account for amounts above Rs 20,000; a claim lapses three years after the end of the tax period.

Sources

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