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13.3. CFC and Similar Regimes

Nepal's controlled foreign company (CFC) provisions apply when the Nepalese resident company controls more than 50% of the interest, capital or voting power in a non-resident entity, either alone or together with not more than 4 other residents. Under the CFC rules, the income earned by the CFCs is subject to tax in Nepal.

Dividends distributed by the CFC to the Nepalese resident company is subject to tax in the hands of the company. Other dividends distributed by a CFC are exempt from tax.