Business Closure

Close your business properly, not just stop answering the phone

Company, firm, VAT, PAN, or excise closure in Nepal — done in the right sequence, so old obligations don't stay open and quietly accrue penalties after you've stopped operating.

Why It's Not Optional

What happens if you just stop operating

Registration, PAN, and VAT don't expire on their own. A company that stops trading without formal deregistration is still expected to file annual returns and compliance documents — and late fees, penalties, and interest accumulate whether or not the business is actually running.

The Process

How closure actually works

Step 1

Settle outstanding tax obligations

Any unfiled returns or outstanding dues need to be resolved first — tax clearance is a prerequisite for the rest of the closure process, not a final step.

Step 2

Obtain tax clearance

Confirmation from the IRD that your filings are current and nothing is outstanding, at the individual, business, or company level as applicable.

Step 3

Close VAT and PAN registration

Each of these needs its own separate deregistration application — closing your company at OCR does not automatically close them.

Step 4

File final financial statements

A closing set of accounts confirming the company's final financial position at the point of dissolution.

Step 5

Submit closure application to OCR

With a board resolution (or the proprietor's formal decision), completing the deregistration of the company itself.

What You'll Need

Documents to have ready

Company registration and PAN/VAT certificates
Final financial statements up to the closure date
Board resolution or proprietor's decision to close
Tax clearance confirmation from the IRD
Prior year filed tax returns and payment receipts
Excise closure documentation, if applicable
Timeline & Cost

What to actually expect

If your filings are current

Closure moves at the pace of the final filing and deregistration paperwork itself — the more straightforward end of the range.

If returns are outstanding

The timeline extends to however long it takes to resolve unfiled returns and outstanding dues first — tax clearance can't be skipped.

Cost depends on your case

Government fees plus any outstanding dues vary by entity type and filing history — we confirm your specific number before you commit, not after.

Common Questions

Business closure, answered honestly

Can I close a company that still has unfiled tax returns?

No — tax clearance is a prerequisite for closure. Any unfiled returns or outstanding dues need to be resolved first, which is why closure sometimes takes longer than expected if filings have lapsed.

Do I need to close VAT and PAN separately from the company itself?

Yes. Closing your company registration at OCR does not automatically close VAT or PAN registration — each requires its own deregistration application.

What happens if I just stop operating without formally closing?

The company remains legally active and is still expected to file annual returns and compliance documents. Late fees, penalties, and interest accumulate whether or not the business is actually running.

How long does business closure take in Nepal?

It depends heavily on your filing history. If tax filings are current, closure is more straightforward. If returns are outstanding, resolving those comes first, which extends the timeline.

Can a Sole Proprietorship be closed the same way as a Private Limited company?

The overall principle is the same — settle tax obligations, close relevant registrations, deregister — but the specific process and authority differ, since a Sole Proprietorship is registered locally rather than through OCR.

Ready to Close Properly?

Let's settle it the right way

Tell us your entity type and filing history — we'll tell you exactly what closure will take.

Talk to Us