All of us have seen digital services like google ads, facebook promotions or subscription of netflix or amazon prime. But have you ever wondered if these services even have to pay for taxes in Nepal? Well the answer to the question is yes any form of service provided in exchange of money must pay taxes and these services pay taxes which is termed as Digital Service Tax(DST).
In this article we will discuss everything that you need to know about Digital Service Tax in Nepal from what it is to who needs to pay it and everything that you need and how GFCS Nepal can help you to stay stress free and in compliance with the laws.
What is Digital Service Tax(DST)?
Digital Service Tax is the type of tax that is applied to services provided to foreign digital companies that earn money from users in Nepal.
This includes:
- Google and youtube ads
- Facebook and instagram
- Netflix and other streaming platforms
- Zoom, Microsoft, etc…
Why was DST introduced in Nepal?
As we know everything is digitizing more and more businesses are preferring the concept of online business and people in Nepal are paying the foreign companies for ads, entertainment, software, etc..
But until recently these international companies were not providing any tax and were providing services instead of money taxless and this is exactly where DST(Digital Service Tax) comes in
The government had a broad plan for introducing DST they saw a lot of profit and a source of revenue that could be utilized for the development of the country’s economy the main reasons were:
- To generate revenue
- To provide the local providers with a fair chance to compete
- To ensure that the international companies pay tax for operating in Nepal
New laws have been made which requires international companies to register, file and pay DST for their services in Nepal.
Who needs to pay DST in Nepal ?
If you’re using the services provided by the foreign digital companies then it is not you who directly pays the tax amount rather it is collected by the companies providing services who are responsible to do so.
So, foreign digital service providers need to:
- Register their company under the IRD(Inland Revenue Department) in Nepal
- File tax returns
- Pay 2% of the revenue generated from Nepali customers
If these companies do not register then, for using their services you may be required to deduct 15% TDS(Tax Deducted at Source) and submit it to the government.
How GFCS Nepal can help
At GFCS Nepal we help businesses maintain tax compliance and that also includes Digital Service Tax (DST). If you’re confused if you have to pay the DST or not or if you’re registered with the IRD or have to get your company approved by the IRD by getting your documents approved, we’re here to guide you.
Here’s how GFCS Nepal supports you:
- We help to check whether the digital service is registered with the IRD
- We keep you updated on policy changes and compliance rules
- We make sure you don’t face any penalties or legal issues
We at GFCS Nepal ensure you stay tax compliant and worry free
Final thoughts
DST is still evolving in Nepal and is relatively a new topic but it is here to stay. So, if your business is spending money on foreign digital service it’s time to get knowledgeable about how DST affects you.
At GFCS Nepal we make the complex tax processes simple for you. We will guide you step by step so that your business is tax compliant, efficient and ready for the future.
Conclusion
If you own a foreign digital service provider and are worried about how you’ll manage DST and everything that’s related to it while setting up the business or to ensure that business runs smoothly don’t worry as this is where GFCS comes in. You can take the service of GFCS Nepal for experienced guidance. We provide easy and professional services .
At GFCS Nepal we specialize in any activity that includes smooth service provision . If you need any kind of help regarding GST or any other financial assistance and services , feel free to reach out to us and we will be glad to help you.
Contact Us:
We are here to make your time very efficient. We will provide suggestions and offer experienced professionals that will help you understand finances and make your process of providing and using digital services from abroad very easy, simple and hassle free . If you have queries or need any kind of help or consultation we are always at your service and our team is always eager to work and coordinate with you to make your work easier. For someone who needs our assistance you can contact us through
Phone: 9802360825
Email: [email protected]
Website:https://gfcsnepal.com/
Location: https://g.co/kgs/J6pufPG
You can also reach us through social media, we have our services available on facebook, Instagram and twitter. You can leave in a msg or a call and our team of experts will reach you as soon as possible. We look forward to working with you and helping you with GST and making sure that you run your services smoothly.