Dividend in Nepal: what it is, how much you get, and the tax

A dividend (लाभांश) is the part of a company's profit that it pays to its shareholders. If you own shares in a company listed on NEPSE, you own a slice of it; when it shares out profit, you get your slice, in proportion to the shares you hold when its register closes.

In Nepal a dividend comes in two forms. A cash dividend (नगद लाभांश) is money, paid into the bank account linked to your demat account after 5% tax. A bonus share (बोनस सेयर) is a free new share, credited to your demat. Many companies declare both at once, for example "4% bonus and 6% cash". Both can come only from profit: a company with nothing left to distribute cannot pay either, however well its share price is doing.

Nothing obliges a company to pay. The board proposes a dividend, a regulator checks it for banks and insurers, and the shareholders approve it at the annual general meeting. A company that is growing may keep its profit to build with; one in trouble may have none to share.

A cash dividend moves money from the company to you. A bonus share moves nothing: the company turns profit it has kept into new shares, and NEPSE cuts the share price to match. 100 shares at Rs 550 with a 10% bonus become 110 shares at Rs 500: Rs 55,000 before and Rs 55,000 after. The bonus pays you only later, if future cash dividends are paid on the larger number of shares.

A right share is not a dividend at all. It is the right to buy new shares, usually at Rs 100, in proportion to what you hold. How bonus and right shares work, how the price is adjusted for each and how to apply for rights is in bonus share and right share in Nepal; this page stays with dividends.

Nepali companies declare dividends as a percentage of the share's face value, which is Rs 100 for most listed shares (a few, such as Soaltee Hotel, are Rs 10). A 20% cash dividend therefore means Rs 20 a share, whatever the share trades at. On a Rs 10 share the same 20% is Rs 2.

This is the most common mistake made with dividends in Nepal. The share you buy on NEPSE does not cost Rs 100; it costs what the market asks. On a share priced at Rs 800, a "20% dividend" of Rs 20 is 2.5% of what you paid, and 2.375% after tax. The headline percentage tells you how much profit the company shares per Rs 100 of its capital, not what you earn on your money.

Every dividend sum in Nepal comes from a handful of formulas. The example row uses 150 shares, a 20% cash dividend, a price of Rs 800 and earnings per share of Rs 40; the bonus rows use a 10% bonus.

Declared

20% cash

Per share

Rs 20

Tax, 5%

Rs 150

Paid to you

Rs 2,850

Sita holds 150 shares of a company that declares a 20% cash dividend. Each share earns 20% of Rs 100, which is Rs 20, so her dividend is Rs 3,000 before tax. The company keeps back 5%, Rs 150, and pays it to the tax office in her name. Rs 2,850 reaches the bank account linked to her demat account: Rs 19 a share.

The same arithmetic for other holdings. Every share on the register is paid, including odd lots of fewer than 10 and shares from an IPO, as long as they were yours on the last trading day before the book closure.

5% of every cash dividend is kept back by the company and paid to the Inland Revenue Department for you, under section 88 of the Income Tax Act, 2058. It is a final withholding (section 92): a resident individual has nothing more to pay or to declare on it.

Bonus shares are taxed too, in practice at 5% of their face value: Rs 5 a bonus share. Companies collect it by adding a small cash dividend to the bonus, explained in the next section. The rule itself is not spelled out in any law text we could read; the practice is consistent across the declarations we checked.

For comparison, the other taxes on what a saver earns, as they stood on 3 November 2026. All are taken before the money reaches you.

A bonus share carries tax, but a share is not money, so the company needs cash to pay it. The usual answer is a cash dividend for tax: a cash percentage sized so that it equals 5% of the whole declaration, bonus and cash together. The formula is bonus % × 5 ÷ 95. The holder then receives the bonus shares and no cash; the cash went to the tax office.

Bikash Hydropower proposed 10% bonus and 0.5263% cash for 2082/83 in September 2026: 10.5263% in all, of which 5% is 0.5263%, exactly the cash. Sahas Urja's 21% bonus came with 1.1053% cash "for tax purposes": 21% × 5 ÷ 95 is 1.1053%.

When the cash is larger, the tax on the whole is taken from it and the rest is paid to you. Global IME Bank proposed 10% for 2082/83: 4% bonus and 6% cash "including tax". The tax on 10% is Rs 0.50 a share, so a holder of 100 shares gets 4 new shares and Rs 550. Shangrila Development Bank's 4% bonus and 6.5263% cash work out to Rs 6.00 a share in hand: an odd-looking percentage that leaves a round sum after tax.

A dividend can only be paid out of profit set aside for it, and only after the company has taken off what the law requires first: costs from before it began operating, depreciation, reserves the law makes it keep, and any losses carried from past years (Companies Act, 2063, section 182). What is left is the distributable profit, the pot every dividend comes from.

For banks the pot is smaller than the profit. Nepal Rastra Bank makes them run net profit through a statement of distributable profit that takes out interest booked but not received, provision shortfalls and deferred tax, and parks some profit in a regulatory reserve that cannot be paid out. Himalayan Bank's fourth-quarter statement for 2080/81 showed a net profit of Rs 1.48 arba and a distributable profit of minus Rs 9.84 arba: it made money on paper and had nothing it could pay.

• Capital rules can stop a bank's dividend. Under NRB's capital adequacy framework a bank whose capital falls into its buffer must keep part or all of its profit, and news reports say NRB bars cash dividends below the 11% minimum. A bank near that line is more likely to issue right shares than pay cash.
• Insurers face a risk-based capital directive from 2084/85 that restricts dividends for those who fail it.
• An interim dividend during the year is allowed by section 182(7) if the company's articles permit it. The dividends on this page are the yearly ones the AGM approves.

1. 1The year ends in mid-July (Asar end) and the accounts are audited.
2. 2The board proposes a cash percentage, a bonus percentage or both, out of the distributable profit.
3. 3A regulator checks it, where one is required. Banks and financial institutions need Nepal Rastra Bank's approval: in August 2026 6 banks applied for it before announcing anything, while others announce a proposal "subject to approval from Nepal Rastra Bank". Insurers need the Nepal Insurance Authority's. A company the government owns, wholly or partly, needs the government's.
4. 4The AGM (साधारण सभा) is called with at least 21 days' public notice. The notice names the book-closure date.
5. 5The AGM approves the dividend. No cash may go to shareholders unless the general meeting approved it (section 182(8)). The AGM must be held within 6 months of the year's end, which is why dividend news runs from about August to January.
6. 6The company pays within 45 days, from a separate account it must fund within the same 45 days.

A headline that says a company "proposes 15% dividend" reports a proposed dividend (प्रस्तावित लाभांश): the board's recommendation, nothing more. It still needs the regulator, for banks and insurers, and the AGM. News sites also use "declares" loosely, often for a board's proposal. Check which step has happened before counting on the money.

Book closure (बुक क्लोज) is the date a company freezes its register of shareholders. Whoever is on the register gets the dividend, the bonus shares and a seat at the AGM. To be on it, you must hold the share at the close of the last trading day before the book-closure date.

A book closure on Poush 22, 2082 (Tuesday 6 January 2026) meant buying by Monday 5 January. Since NEPSE moved to a Monday–Friday week in April 2026, a Monday book closure means buying by the Friday before: Global IME Bank and Nepal Lube Oil closed their books on Monday 21 September 2026, the last day to buy was Friday 18 September, and NEPSE adjusted their prices after Friday's trading.

Shares bought on that Friday only reach your demat account on Tuesday, two trading days later (T+2), after the book closure. They still count: every company notice and market reminder we read treats the day you bought as what matters. We found no NEPSE or CDSC rule text that says so, so if you are unsure, buy a day earlier. By the same reading, selling on the book-closure day or later does not take the dividend away.

• Where to find the date: the AGM notice in a national daily and on the company's website, reposted by ShareSansar under its book-closure events (links in the dividend history section below).
• Book closures are also held for right shares and for closed-ended mutual funds' dividends, with the same last-day rule.
• A book closure on a holiday or weekend still means the last trading day before it, however many days back that is.

The Companies Act gives a company 45 days from the decision to pay, which is the AGM's approval, not the book closure (section 182(1)). The AGM comes after the book closure: Shangrila Development Bank's prices were adjusted after its book closure in late September 2026, and its AGM was called for Ashwin 22, 2083, in early October. Its cash was due within 45 days of that meeting.

So, as a rough guide, the cash can take up to about two months from the last day to buy: the gap to the AGM plus up to 45 days. Many companies pay sooner; in 2026 news reports described banks working to pay before Dashain. A payment later than the law allows must carry interest (section 182(3)), unless a law bars it, the holder's right is disputed or something beyond the company's control prevents it.

• Cash and bonus travel separately. The cash goes straight to your bank. Bonus shares have to be registered with SEBON, credited to demat accounts and listed on NEPSE before you can sell them, which can take weeks or months longer.
• Mutual funds pay to the same bank account, or in new units if you chose reinvestment.
• The tax is already taken when the money arrives: what you see is the dividend less 5%.

A cash dividend is paid into the bank account linked to your demat account, not to whatever account you use for trading or salary. SEBON directed companies to pay this way, and CDSC has asked investors to keep a bank account on their demat record. The name on the bank account must match the demat account.

Money that cannot be paid, because no account is linked or the details are wrong, waits with the company as an unclaimed dividend. Companies publish lists of unpaid dividends and ask holders to collect them. After 5 years from the AGM's decision, unclaimed dividends go to the Investor Protection Fund, after a notice in a national daily giving at least one month to claim (Companies Act, section 182(9) and (10)).

1. 1Count the days. Find the AGM date in the company's notice and add 45. Before that, nothing is late.
2. 2Check the right account. Look at the statement of the bank account linked to your demat, for a credit in the company's or its registrar's name.
3. 3Check MeroShare. My Details shows the bank account on your demat. MeroShare has a form, "Request for bank account changes in demat account (only for cash dividend collection)"; your depository participant (DP) can also change it.
4. 4Ask the share registrar. Every listed company has one (an RTA), named in its notices. Give your BOID, name and the fiscal year of the dividend.
5. 5Look for old dividends too. If you held shares years ago, search the company's notices for unpaid dividend lists before the 5 years run out.

After a book closure NEPSE makes a price adjustment for a bonus, so the holding is worth the same before and after: the last traded price before the book closure divided by (1 + bonus %), applied from the next trading day. The four adjustments of September 2026, worked out here and checked against the prices NEPSE published:

• The cash is not taken off. Shangrila Development Bank declared 6.5263% cash as well as its bonus, yet 428 became 411.54, which is 428 ÷ 1.04 exactly. Global IME Bank's 6% cash was ignored in the same way. That is our arithmetic from ShareSansar's reports, not a rule NEPSE publishes.
• The bonus adds nothing on the day. 100 Global IME shares were worth Rs 26,090 at 260.90; the next trading day 104 shares at 250.87 were worth Rs 26,090.48.
• So why does the price often drift down? In theory a company that pays out Rs 6 a share is worth about Rs 6 a share less, and the market, not NEPSE, finds the new price for the cash part. On any given day other news moves a price far more than a few rupees of dividend, so nothing guarantees a fall of any size.

Ram buys 100 shares at Rs 800 on the last day before book closure, for a 20% cash dividend. The shares cost Rs 80,301 with commission, the SEBON fee and the DP charge. The dividend brings Rs 1,900 after tax. He sells in the days after the book closure. What he ends with depends on the price then; every charge below is the real one, worked out through this site's share calculator rules.

Buying and selling cost about Rs 595 in charges, 31% of the dividend after tax. If the price falls by the dividend, he loses money; if it falls by twice the dividend, which a single bad week can bring, he loses more. He comes out ahead only if he can sell at Rs 787 or more, a fall of less than Rs 13, and then because the price held, not because of the dividend.

Dividend yield is the cash dividend per share divided by the share price. It turns a percentage of face value into a percentage of your money, which is the only way to compare one company's dividend with another's, or with a deposit. It is one of the most searched questions about dividends in Nepal.

The three companies below are made up. The one with the biggest headline pays the least for each rupee you put in. Beside them, a fixed deposit at the average bank's best rate in Kartik 2083, 4.013%, paid 3.77% after the 6% tax, and that rate was fixed while a dividend is not.

• Use the price you could buy or sell at today. If you bought at Rs 300 years ago, a 20% dividend is 6.7% on your cost but 2.5% on today's Rs 800 price, and today's price is what you give up by holding.
• Count cash only. Bonus shares are not cash, and the price is cut to match them; a yield that counts a bonus at face value overstates what you earn.
• A yield looks back. It uses last year's dividend. Next year's can be lower, or nothing.
• A dividend is only part of the return. The rest is the change in price, which can be far larger either way.

The payout ratio is the dividend per share divided by EPS (earnings per share, प्रतिसेयर आम्दानी): the share of a year's profit that the company hands out. What it keeps, it can lend, build with or hold against bad years. Company D earns Rs 25 a share and declares 10% cash and 5% bonus: it pays 40% of its profit in cash, or 60% counting the bonus at face value.

A bonus keeps the money in the company. The profit behind it becomes share capital instead of cash in your hand, which is why a declaration that is mostly bonus is really a decision to retain profit. Company E pays Rs 12 a share while earning Rs 8: a payout of 150%, paid partly from past years' reserves. That cannot go on for long.

• For banks, use distributable profit, not EPS. A bank can show healthy EPS and still have nothing NRB lets it pay.
• Quarterly EPS in Nepali reports is annualised: a half-year's profit doubled, and so on. Use the audited yearly figure for a payout ratio.
• A bonus lowers next year's EPS because the same profit is spread over more shares. Compare EPS adjusted for bonus shares.

There is no honest one-name answer, and this page names none. The company with the biggest percentage this year is often not the one that pays you the most for your money, and not necessarily one that keeps paying. Six reasons the headline misleads:

• It is a percentage of face value. Company C's 50% yields 2% at its price; Company B's 10% yields 4%.
• Much of it may be bonus. A "22.1053% dividend" made of 21% bonus and 1.1053% cash for tax puts no cash in your hand at all.
• One year is not a record. A big dividend can come from a one-off gain, such as selling an investment, or from reserves built over years.
• It can exceed the profit. A payout ratio over 100% is a dividend the company cannot repeat.
• Regulators set limits. A bank's or insurer's dividend depends on capital rules that change, so last year's figure says little about next year's.
• The price already knows. A company known for big dividends is priced by people who know it too. What you would get is the yield at today's price, not the reputation.

1. 1Take the cash part only of each declaration.
2. 2Work out the yield on today's price, after the 5% tax.
3. 3Look at five years or more of history: how many years it paid, and how much in cash.
4. 4Check the payout ratio against EPS, and for banks the distributable profit.
5. 5Compare with a deposit after its 6% tax, remembering a deposit's rate is fixed and a dividend is not.

Dividends change every season, so this page keeps no table of companies that would be wrong within weeks. These are the pages that are kept up to date, as we found them on 3 November 2026. They are run by others; the company's own notice is the final word if they differ.

1. 1Find the company's symbol, the short code NEPSE uses, from its name.
2. 2Open its page on ShareSansar and choose the Dividend History tab; AGM History and Right Share History sit beside it.
3. 3Write down, for each fiscal year, the bonus % and the cash %. Leave out the years it paid nothing, but count them.
4. 4Check the latest year against the company's own notice or website.
5. 5Put the numbers in the dividend calculator with your shares and the price, and read the next section on what the history says.

A list of percentages is easy to misread, because bonus shares change how many shares the later percentages are paid on. Here is a made-up company's five years, followed for someone who started with 100 shares. The headlines add up to 57.5%, about 11.5% a year. What the 100 shares actually brought in cash after tax was Rs 3,936.90, plus 21 extra shares.

• Consistency first. It paid something in 4 of 5 years. A history with gaps is a business, or a regulator, that cannot always pay.
• Cash or bonus. Year 1 looks like a 10.5% dividend and paid nothing in cash. Separate the two columns before you compare.
• Adjust for the bonuses. Year 5's 12% is paid on 121 shares, so it brings 21% more money than 12% on the original 100. A falling percentage after years of bonuses can still mean the same rupees.
• Set it against profit. Put each year's dividend beside that year's EPS. A dividend that grows with profit is worth more than one paid from reserves.
• Read the fiscal year. A dividend listed under 2082/83 was earned in the year to mid-July 2026 and paid in the months after.
• Watch for mergers. A company that merged has a history that mixes two companies' capital; compare the years after the merger with each other.

Mutual funds pay dividends too, usually called payouts or distributions, and they are declared as a percentage of the Rs 10 unit. A 10% payout on 1,000 units is Rs 1,000, and the fund keeps back 5%, final, so Rs 950 reaches you.

Closed-ended funds, which trade on NEPSE, hold a book closure like a company, with the same last-day rule. Open-ended funds, the ones a SIP buys, pay to the bank account linked to your demat or, if you chose it, in new units. Either way the fund's NAV falls by the amount paid: the cash leaves the fund and comes to you, so a payout is part of the fund's value handed back, not extra money.

That is why judging a SIP fund by its NAV alone undercounts the ones that pay out. Every SIP fund's payout history, and how to read it, is in SIP in Nepal; the SIP calculator replays real funds with their payouts.

1. 1Find the declaration on ShareSansar's Proposed Dividend page or the company's notice, and split it into bonus % and cash %.
2. 2Check it is approved: by NRB or the Insurance Authority where needed, then by the AGM.
3. 3Note the book-closure date, and the last trading day before it. That is the day you must hold the share.
4. 4Work it out in the dividend calculator: cash after tax, new shares, the adjusted price and the yield on today's price.
5. 5Check the bank account on your demat in MeroShare, so the cash has somewhere to go.
6. 6After the AGM, give it 45 days, then look at that bank account's statement, and ask the registrar if nothing came.