NGO Registration in Nepal
2025 Expert Guide
Establishing a Profit Not Distributing Body (PNDB) is the modern way to do social work in Nepal. We handle the OCR legalities, drafting, and approvals so you can focus on your impact.
Understanding Not-for-Profit Companies
In Nepal, NGOs can now be registered as a Profit Not Distributing Body (PNDB) under Section 166 of the Companies Act, 2063. This is distinct from the traditional “Club” or “Sanstha” registered at the CDO office. The PNDB route is preferred by professional foundations, research institutes, and modern social entrepreneurs.
Legal Entity Status
An OCR-registered NGO is a distinct legal person. It has the right to own property, sue and be sued, and ensures the liability of members is limited.
Membership Structure
Requires a minimum of 5 promoters to start. Unlike private companies, there is no maximum limit on members, allowing for broad community participation.
Compliance Ease
Renewals are handled via the Office of Company Registrar (OCR). It avoids the complex annual political bureaucracy often faced at the District Administration Office.
⚠️ The “Non-Distribution” Constraint
Before registering, you must understand the core legal requirement. Even though it is registered as a “Company,” it cannot function like a business for personal gain.
No Dividends Allowed
Members and directors strictly cannot receive dividends, bonuses, or profit shares. All surplus revenue must be reinvested into the objective.
Asset Locking
Upon dissolution (closing), the assets cannot be shared among members. They must be transferred to the Government of Nepal or another similar non-profit.
Registration Route: DAO vs. OCR
Most clients ask us: “Should I go to the CDO office or Company Registrar?” Here is the comparison.
| Feature | Traditional NGO (CDO/DAO) | Company NGO (OCR) – Recommended |
|---|---|---|
| Governing Act | Association Registration Act 2034 | Companies Act 2063 (Section 166) |
| Founding Members | Minimum 7 Members required | Minimum 5 Promoters required |
| Renewal Process | Complex (Requires Police Report + Ward Rec every year) | Streamlined (Online filing of Audit Report & AGM) |
| Foreign Funding | Requires SWC Approval | Requires SWC Approval |
| Best For | Local Community Clubs, Tole Sudhar | Foundations, Research, Professional NGOs |
7-Step Registration Workflow
Name Reservation
We check the OCR database for availability. The name usually ends with terms like “Foundation,” “Academy,” “Center,” or “Nepal.”
Drafting MOA & AOA
Our legal team drafts the Memorandum (Objectives) and Articles (Rules). These must specifically include non-profit clauses.
OCR Submission
We upload notarized citizenship copies and documents to the OCR digital portal for verification.
Ward Registration
Once the company is incorporated, we register it at the Local Ward Office where your HQ is located.
PAN Registration
Obtain a Permanent Account Number (PAN) from the Inland Revenue Department (IRD).
Tax Exemption
Apply for Tax Exempt Entity status at the IRD (Note: This is a separate rigorous process).
Required Documents
Please prepare the following to start the process with BizSewa:
- Citizenship copies of all 5 promoters (Notarized)
- Passport size photos (3 each)
- Proposed Name of the Organization
- Main Objectives (Health, Education, Environment, etc.)
- Rent Agreement (For office address)
- Ward Recommendation Letter (We assist with this)
Estimated Costs (2025)
Includes Government Fees & Stamps.
- OCR Registration Fee Rs. 15,000
- Ward Reg (Approx) Rs. 5,000
- PAN/Tax Reg FREE
- Total Govt Cost (Est.) Rs. 20,000*
*Excludes professional legal drafting fees and Rent Tax (TDS).
Frequently Asked Questions
Q1: How long does the registration take?
The OCR registration typically takes 3 to 7 working days if all documents are in order. Ward and PAN registration take an additional 2 days.
Q2: Is tax exemption automatic?
No. By default, you are a tax-paying entity. You must apply for a Tax Exemption Certificate at the IRD by proving your funds are used strictly for social welfare.
Q3: Can we take salaries?
Employees can take reasonable salaries for their work. However, Board Members generally work on a voluntary basis and should not take a salary for being a “Director,” though they may be reimbursed for meeting allowances.
Q4: Do we need SWC Affiliation?
If you plan to bring money from foreign donors or INGOs, affiliation with the Social Welfare Council (SWC) is mandatory.
Ready to Start Your Mission?
Don’t let bureaucracy slow down your social impact. Let BizSewa handle the legal paperwork while you focus on the cause.
BizSewa: Trusted Company Registration Partner in Nepal
Fatema Khan