Nepal is rapidly modernizing its fiscal landscape. With the recent introduction of the Digital Service Tax (DST) on foreign tech companies and mandatory PAN requirements for salaried employees, the Inland Revenue Department (IRD) is tightening its grip on the economy.
For international investors, trekking agencies, and digital platforms, compliance relies entirely on the PAN (Permanent Account Number). Whether you are remitting TDS (Tax Deducted at Source) for a local contractor or paying the 2% DST as a foreign software provider, a valid PAN is the cornerstone of all transactions.
Introduction
The backbone of Nepal’s fiscal infrastructure is the IRD Integrated Tax System. It links tax data with banking and customs.
For global enterprises, the challenge is verifying the 9-digit PAN. In Nepal, a PAN can be “Active” but suspended for specific transaction types (like VAT). Distinguishing between a generic PAN and a VAT-registered PAN is critical for claiming input tax credits.
