Capital gains tax on shares in Nepal (2083/84): rates, examples and dividend tax

Held over 365 days

3.75%

Held 365 days or less

5%

In force since

22 Sep 2026

Cash dividends

5%

Capital gains tax (पुँजीगत लाभ कर, CGT) is the tax on the profit from selling something for more than it cost you. On shares listed on NEPSE, a resident individual (बासिन्दा प्राकृतिक व्यक्ति) pays 3.75% of the gain on shares held more than 365 days and 5% of the gain on shares held 365 days or less.

These rates have applied since 22 September 2026 (Ashoj 6, 2083). That day the Ministry of Finance published in the Nepal Gazette (नेपाल राजपत्र) a decision of the Council of Ministers, made under section 18(1) of the Finance Act 2083 (आर्थिक ऐन, २०८३), cutting the rates the budget had set. They hold for the rest of the fiscal year 2083/84, which runs to the end of Ashar 2084 (mid-July 2027), unless they are changed again.

The tax is on the gain, never on the sale amount. In the sale worked below, 1,000 shares sell for Rs 5,60,000 and cost Rs 4,51,577.50 with charges, so the gain after the selling charges is Rs 1,06,577.50. The tax is Rs 5,328.88 at 5% or Rs 3,996.66 at 3.75%, not a share of the Rs 5,60,000. You never pay it yourself: CDSC works it out when the trade settles, two working days after the sale, and your broker pays you what is left.

Up in the budget. The budget for 2083/84, presented on 29 May 2026 (Jestha 15, 2083), raised the rates for individuals from 7.5% and 5% to 10% on shares held 365 days or less and 7.5% on shares held longer, and made the tax final. The higher rates took effect on 17 July 2026, Shrawan 1, 2083, the first day of the fiscal year. The IRD's booklet on the Finance Act 2083 still gives them.

Down by notice. NEPSE fell, and Republica reported the reversal as a response to the slump. On 15 September 2026 the Ministry of Finance's Capital Market Strengthening and Revival Action Plan said the tax would be capped at 5%. The Council of Ministers approved new rates on 16 September 2026, and the first reports gave 3.5% for long-term holdings. The notice published in the Gazette on 22 September 2026 says 3.75% and 5%, from that day. 3.75% is the figure applied; pages that say 3.5% copied the first reports.

So the fiscal year 2083/84 has had two rate sets so far, and the calendar year 2026, like the Nepali year 2083, has had three. The current rates are exactly half the budget's: 10% became 5% and 7.5% became 3.75%. Today's short-term rate is the old long-term one.

The September notice covers one case: a resident natural person selling shares listed on the market. The IRD's booklet words it as the gain from disposing of an interest in an entity listed with the Securities Board of Nepal (नेपाल धितोपत्र बोर्डमा सूचीकरण भएको निकायको हित). In plain words, a Nepali individual selling a listed company's shares through a broker: almost everyone who trades in TMS.

Everyone else is taxed under section 95क of the Income Tax Act. Its text before 2083/84 set 10% for a resident entity (a company, bank, fund or other institution) and 25% for others, which includes non-residents. Neither the IRD's booklet on the Finance Act 2083 nor the September notice mentions them, and we found no 2083/84 figure published for either. Treat 10% and 25% as the last known text, not as confirmed.

The taxable gain is what is left of the sale after the selling charges, less what the shares cost you. "What they cost you" is not the last price you paid but your WACC (weighted average cost, भारित औसत लागत): the average cost of all your shares in that company, buying charges included. Section 95क(2क) of the Income Tax Act, added by the Finance Act 2076, requires the gain to be worked out this way, and MeroShare keeps the figure for you.

1. 1Sale amount: the price times the number of shares sold.
2. 2Less the selling charges: broker commission (0.36% on a sale up to Rs 50,000, falling by size to 0.24% above Rs 1 crore, at least Rs 10), the SEBON fee of 0.015% and the DP charge of Rs 25.
3. 3Less your cost: your WACC times the number of shares sold. The WACC already includes the commission, SEBON fee and DP charge you paid when buying.
4. 4What is left is the taxable gain. If it is zero or less, there is no tax.
5. 5The tax: the gain times 3.75% or 5%, by how long the shares were held.
6. 6You receive the sale amount less the charges and the tax, two or three working days after the sale.

Take 1,000 shares bought at Rs 450 and sold at Rs 560. Buying cost Rs 4,50,000 plus Rs 1,485 commission (0.33%), a Rs 67.50 SEBON fee and the Rs 25 DP charge: Rs 4,51,577.50, a WACC of Rs 451.58.

The sale brings Rs 5,60,000, less Rs 1,736 commission (0.31%), a Rs 84 SEBON fee and Rs 25: Rs 5,58,155 is left. Take away the cost and the taxable gain is Rs 1,06,577.50. Held 365 days or less, the tax is Rs 5,328.88 and you receive Rs 5,52,826.13. Held more than 365 days, the tax is Rs 3,996.66 and you receive Rs 5,54,158.34: Rs 1,332.22 more for the same trade.

The gain is the same Rs 1,06,577.50 whatever the date; only the rate changes. Sold short-term at the budget's 10%, this sale paid Rs 10,657.75; at today's 5% it pays Rs 5,328.88, half as much. Held over a year, it paid Rs 5,328.88 under the 2082/83 rates and pays Rs 3,996.66 now.

The holding period (स्वामित्व अवधि) runs from the day the shares reached your demat account, not the day you placed the order. CDSC's letter to brokers of 2078/04/03 splits a holding into short and long term by the date ownership was transferred. For shares bought on NEPSE that is the settlement day, normally two working days after the trade; for IPO, bonus and right shares, the day they were credited.

MeroShare marks every lot held more than 365 days LT (long-term) and the rest ST. Each lot has its own clock: buy 100 shares two years ago and 50 last month, and you hold 100 LT and 50 ST. When you sell part of a holding, CDSC's manual counts any shares exempt after a merger first, then long-term shares, then short-term ones, which is in your favour.

• Leave a margin. More than 365 days means a sale on day 366 or later. Counting can differ by a day, so do not sell on the anniversary itself: open My Holdings in MeroShare first and check the lot shows LT.
• If MeroShare's days are wrong, for shares that came by transfer or from paper certificates, say, enter the real period under User Defined Holding Days with proof in Remarks before you transfer the shares. After a sale has gone through, CDSC's Holding Days Reset form costs Rs 100 a company.
• Bonus shares start their own clock on the day they are credited, however old the shares they came from.

MeroShare builds your WACC from your purchase sources: every lot it knows about, at the cost recorded for it. Shares bought on NEPSE should carry the price and the buying charges, as the per-share cost on your broker's bill does; IPO and right shares carry their issue price, and bonus shares Rs 100. Lots it has no price for, such as shares from old paper certificates or transfers, wait for you to fill in. Until every source is confirmed, MeroShare will not let you transfer shares you have sold.

A WACC that is too low makes the gain look bigger and the tax higher. One that is too high cuts the tax, but you confirm it under a declaration that the figure is true under the Income Tax Act, with the legal consequences if it is not, so it is not a way to save tax.

1. 1Log in to MeroShare and open My Purchase Source, then the Purchase Source tab.
2. 2Choose the company and press Search. Each purchase is listed with its date, quantity and rate.
3. 3Check every rate against your broker's bill, the IPO allotment or Rs 100 for a bonus share. If one is wrong and you have proof, type the right figure and describe the proof under Remarks.
4. 4Tick the purchases, press Proceed, accept the declaration and press Update.
5. 5Do the same for the holding period on the My Holdings tab.

Say you hold 200 shares of one company: 100 bought at Rs 480 (Rs 48,205 with charges) and 100 at Rs 520 (Rs 52,204.40). Your true WACC is Rs 502.05. Now say the second purchase was confirmed at Rs 100 a share, a slip in My Purchase Source. MeroShare's WACC becomes Rs 291.03. You sell all 200 at Rs 600 within the year.

The slip adds Rs 2,110.22 of tax, about 21 times the Rs 100 the reset form costs. Leaving out the buying charges is a smaller error: confirming the bare prices, Rs 480 and Rs 520, understates the cost by Rs 409.40 and adds Rs 20.47 of tax.

An IPO share (आईपीओ) costs what you paid for it: Rs 100 for most issues, or the issue price if it was sold at a premium. An allotment carries no broker commission or SEBON fee, so the issue price is the whole cost. The holding period starts when the shares are credited to your demat, and you can sell once the company is listed. How to apply is in how to apply for an IPO in MeroShare.

Ten shares allotted at Rs 100 and sold at Rs 420 bring Rs 4,200. The charges are Rs 15.12 commission, a Rs 0.63 SEBON fee and the Rs 25 DP charge, Rs 40.75 or 0.97% of the sale, most of it the flat DP charge. The gain is Rs 3,159.25.

For capital gains tax a bonus share (बोनस सेयर) costs Rs 100, its face value (अंकित मूल्य), though you paid nothing for it, and a right share (हकप्रद सेयर) bought at Rs 100 costs the Rs 100 you paid. That rests on an instruction from the IRD to NEPSE in Jestha 2075 (June 2018) to take face value as the cost. CDSC's circular passing it on also mentioned a Finance Ministry working group, and we found no later rule either way, so check that My Purchase Source shows the bonus at Rs 100 before you sell.

Bonus shares pull your WACC down. Say you bought 100 shares at Rs 550 for Rs 55,214.75, a WACC of Rs 552.15. The company gives a 10% bonus: 10 new shares at Rs 100 each. You now hold 110 shares that cost Rs 56,214.75, a WACC of Rs 511.04. NEPSE adjusts the price the same way, Rs 550 ÷ 1.1 = Rs 500, so the holding is worth the same the day after as the day before.

More than a year later, with every lot long-term, you sell all 110 at Rs 560: Rs 61,600, a gain of Rs 5,147.73 over the averaged cost and Rs 193.04 of tax at 3.75%.

• Mixed ages. Sell all 110 while the bonus shares are under a year old and the 100 are older, and 100 count as long-term and 10 as short-term. If CDSC shares the gain by the number of shares in each, as its manual suggests, the tax is Rs 198.89 instead of Rs 193.04.
• Right shares lower the WACC the same way. 100 shares at a WACC of Rs 400 and a 50% right at Rs 100 make 150 shares at Rs 300.
• The tax at issue is separate. The 10 bonus shares were also taxed 5% of their face value when they arrived, Rs 50, as a dividend (next sections). That leaves their Rs 100 cost unchanged.

If the sale brings in less than your cost after charges, there is no gain and no capital gains tax, though the commission, SEBON fee and DP charge are still taken. Bought 100 shares at Rs 640 (Rs 64,245.80 with charges) and sold at Rs 590: Rs 58,771.45 comes back, a loss of Rs 5,474.35, and the tax line on the bill is zero.

A price a little above what you paid can still be a loss. 100 shares bought at Rs 500 cost Rs 50,212.50 with charges, and a sale only covers them from Rs 504.12 a share, the break-even price. Sold at Rs 503, they lose Rs 111.03 and pay no tax.

A loss does not reduce the tax on another sale. Each sale is taxed on its own at settlement. The Ministry of Finance's action plan of 15 September 2026 proposed taxing only the net gain, with losses on listed shares set off against gains through the trading and settlement system. It was not in force on 23 October 2026, and we found no change by 3 November 2026.

For most people the tax taken at settlement is the end of it. In law it is collected in advance (अग्रिम कर) under section 95क, and the IRD's booklet on the Finance Act 2083 says it counts as a final withholding (अन्तिम कर कट्टी) for anyone who does not wish to file a return: nothing to declare and nothing more to pay. The budget made the tax on listed shares final; the September notice changed only the rates.

The gain is not added to your salary. Salary is taxed on its own slabs, and a share gain left as final does not push you into a higher one. Work out the tax on your pay separately in the income tax calculator.

If you file a return anyway, because you run a business or have income not taxed at source, the law lets you include the gain and count the tax already taken. We found no plain IRD guidance on how an individual should show it, or on whether a loss can then be set against it: ask the IRD or a registered tax adviser for your own case.

Section 95क(2)(क) of the Income Tax Act makes the body running the securities market collect the tax. In practice CDSC works it out in settlement and your broker pays you net of it. CDSC's own settlement timetable has the steps:

No screen in MeroShare shows the tax itself, as far as we found. It shows the two numbers the tax is built from: your WACC in My Purchase Source and the LT/ST split in My Holdings. The tax appears on your broker's contract note, the bill for the sale, beside the sale amount, commission, SEBON fee and DP charge.

1. 1Before you sell, confirm every purchase in My Purchase Source and check that the lots you mean to sell show LT or ST as you expect in My Holdings.
2. 2Work out the result in the share calculator: choose Sell — profit and tax, tick My buy price is MeroShare WACC, enter your WACC, the number of shares and the sale price, and tick Held more than 365 days if the lot shows LT.
3. 3After the sale, read the capital gains tax line on the broker's bill and compare.
4. 4If they differ by more than a few paisa, check the WACC and holding days again, then ask the broker which cost and rate CDSC used. A confirmed WACC that was wrong needs CDSC's reset form.

A cash dividend (नगद लाभांश) from a Nepali company is taxed 5%, the dividend tax (लाभांश कर), withheld by the company before it pays you, and final (Income Tax Act, sections 88(2)(क) and 92(1)(क)). It is not capital gains tax, and it does not touch your WACC.

Dividends are declared as a percentage of the Rs 100 face value, not of the price. 100 shares with a 15% cash dividend earn Rs 1,500; the tax is Rs 75, and Rs 1,425 reaches the bank account linked to your demat. At a market price of Rs 600 that is a yield of 2.5% before tax, not 15%.

The Income Tax Act counts profit turned into bonus shares as a distribution (section 53), and companies withhold 5% on it as on a cash dividend. Most collect it by declaring a small cash dividend for tax beside the bonus, sized so that it is exactly 5% of the whole: the bonus percentage times 5 ÷ 95.

Bikash Hydropower's dividend for 2082/83 is 10% bonus plus 0.5263% cash "for tax purposes": 10 × 5 ÷ 95 = 0.5263, and the cash is 5% of the total. Sahas Urja's was 21% bonus plus 1.1053% cash: 21 × 5 ÷ 95 = 1.1053, again 5%. In both the cash only covers the tax, so nothing reaches your bank. Where a company pays no cash, its notice or its share registrar tells holders how to pay before the bonus is credited.

So a bonus share is taxed in two parts, at two times: its Rs 100 as a dividend when it arrives, and anything you sell it for above Rs 100, through your WACC, as a capital gain. We found this practice in every 2025–26 declaration we read; the IRD has published no separate note on it that we found.

Payouts from any mutual fund are taxed 5%, withheld by the fund and final. Selling units is less clear.

Closed-ended units are listed on NEPSE and sold through a broker like shares, at a lower commission: 0.15% up to Rs 5 lakh, 0.12% to Rs 50 lakh and 0.1% above, at least Rs 10. Whether the September rates cover them turns on whether a fund's unit is "an interest in an entity listed" with SEBON. We found no ruling or notice either way.

Open-ended units, the kind a SIP buys, are not listed at all: you sell them back to the fund manager. If they fall outside the notice, the Act's text gives 10%, withheld by the fund, and fund managers' own pages still showed the old 5% and 7.5% on 2 November 2026. Before you redeem, ask the manager what it will deduct. More in the SIP guide.

Land and buildings run on a different clock and different rates. For an individual selling land or a house that is not business property (a non-business chargeable asset, गैर व्यावसायिक करयोग्य सम्पत्ति), the Finance Act 2083 raised the rate from 5% to 7.5% for property held five years or more, and from 7.5% to 10% for property held less than five years, as the IRD's booklet sets out. The September cut was for listed shares only, so these stand.

As with shares, the tax is taken when the sale goes through and is final for someone who does not file a return. Land also has exemptions and valuation rules that shares do not; this section is here only to set the two side by side.

• Selling on the anniversary. A lot needs more than 365 days. Check My Holdings shows LT before you place the order.
• Not checking My Purchase Source. One lot confirmed at Rs 100 instead of Rs 520 added Rs 2,110.22 of tax in the example above.
• Typing bare prices. The WACC should include the commission, SEBON fee and DP charge you paid to buy.
• Counting a bonus from the old purchase. Bonus shares are short-term for a year after they are credited.
• Expecting a loss to cut the tax on another sale. It does not, until the proposed offset becomes law.
• Deciding on old rates. A page that still says 10% and 7.5% makes waiting look worth 2.5% of the gain; it is worth 1.25%.
• Missing EDIS by T+1. The closeout penalty dwarfs any tax.
• Overstating the WACC to pay less. You confirm it under a declaration under the Income Tax Act; a false one is the IRD's business.
• Adding the share gain to your salary tax. Left as final, it is taxed only once, at settlement.