Nepal: Financial Services

Nepal has introduced a statutory Safe Harbour framework for transfer pricing through the amendments made by the Finance Act, 2083 to the Income Tax Act, 2058. The new provision, Section 33A, establishes prescribed conditions under which eligible taxpayers can determine the transfer price of specified transactions by applying the statutory safe harbour benchmarks. The reform adds a more predictable mechanism to Nepal’s existing transfer pricing framework, which is principally governed by Section 33 of the Income Tax Act and the Inland Revenue Department‘s Transfer Pricing Directives, 2024 (2081 BS).