Three Different Things Called “Increasing Capital”
Almost every published guide treats this as one procedure. It is three, they need different resolutions, and using the heavier one when the lighter one would do is the most common and most expensive mistake in this area.
| What you are doing | Section | What it takes |
|---|---|---|
| Authorised capital — raising the ceiling by creating new shares | s.56(1)(a) | Special resolution (75%) |
| Issued capital — issuing more shares within the existing ceiling | s.56(5) | Ordinary resolution |
| Allotment — actually giving the shares to someone | s.31 | Board decision, then a return to OCR within 30 days |
The sub-section almost nobody cites
Section 56(5) reads:
“Where a company needs to increase its issued capital up to the limit of its authorised capital, it may increase such capital by passing an ordinary resolution at the general meeting.”
If your authorised capital is NPR 1 crore and you have issued NPR 20 lakh, you can go to NPR 1 crore issued on an ordinary resolution — a simple majority. No special resolution, no 75% threshold, and no fee, because the authorised capital has not moved.
Six of the seven law-firm guides we checked send readers to a special resolution for this. OCR’s own company-administration page gets it right and asks only for “a copy of the decision passing an ordinary resolution at the general meeting” in this case.
Authorised, issued, paid-up — the distinction that makes the rest make sense. Authorised is the ceiling written into your memorandum. Issued is how much of that ceiling you have actually turned into shares and given to shareholders. Paid-up is how much of the issued amount has actually been paid for. Government fees attach to authorised capital. Most thresholds in the Act — the company secretary requirement, the Section 81 penalty bands — attach to paid-up.
The Fee Is a Differential, Not a Percentage
This is where published guidance goes furthest wrong. The Nepal Gazette notification of 2064.02.14 says:
“In the case of an increase in capital, the shortfall shall be paid according to the new rate after deducting the fee already paid in proportion to the additional capital.” And: “Where the previous capital is unchanged or reduced — NPR 1,000.”
So the fee is: the registration fee for your NEW TOTAL authorised capital, minus the fee you already paid. It is computed on the new total, not on the increase, and you get credit for what you have already paid.
| Authorised capital (NPR) | Registration fee (NPR) |
|---|---|
| Up to 1,00,000 | 1,000 |
| 1,00,001 – 5,00,000 | 4,500 |
| 5,00,001 – 25,00,000 | 9,500 |
| 25,00,001 – 1,00,00,000 | 16,000 |
| Above 1,00,00,000 | 16,000 + 3,000 per additional crore |
Worked example
A company with NPR 10,00,000 authorised capital raises it to NPR 50,00,000.
- Fee for the new total of NPR 50,00,000 — falls in the 25,00,001–1,00,00,000 band: NPR 16,000
- Less the fee already paid at NPR 10,00,000 — the 5,00,001–25,00,000 band: NPR 9,500
- Payable: NPR 6,500
What you will be quoted instead. Several widely-read guides publish a percentage formula — “0.5% of the increase, minimum NPR 5,000, maximum NPR 500,000” is the most-copied version. On a NPR 1 crore increase that gives NPR 50,000. The Gazette’s entire fee for a company with NPR 1–2 crore of authorised capital is NPR 19,000, and that is before the credit for what you already paid. These formulas are computed on the wrong base, at an invented rate, and none of them mentions the deduction. There is no percentage anywhere in the Companies Act fee schedule.
The FY 2080/81 fee waiver is over. Capital-increase fees were fully waived for that year alone, by a Gazette notification of Ashoj 2080 made under a power in the Finance Act 2080. It was not extended into 2081/82, 2082/83 or 2083/84. Several sites still describe it in the present tense.
Deadlines — and the One That Is Actually Enforced
Section 56(3) requires the resolution and the amended memorandum and articles to be filed with the Office with the prescribed fee, and the Office records the increase and informs the company within 7 days. It sets no deadline for your filing.
Because s.56(2) deems the memorandum and articles amended once the special resolution passes, the defensible reading is that the Section 21(2) thirty-day information duty applies. We state that as a reading rather than a quoted deadline, because the Act does not say it in terms.
The hard deadline is the one for allotment. Section 31(1) requires a return of allotment to be filed with the Office within thirty days of allotting the shares. That is a statutory deadline with a real filing behind it, and it is the one most often missed — because people treat the capital increase as finished when OCR records the new authorised figure, and forget that issuing the shares to somebody is a separate event with its own clock.
Late filing falls under Section 81(6): NPR 200 per month from one month after the deadline, capped at NPR 1,000 per financial year — a proviso present in the Nepali text but absent from the circulating English translations and from OCR’s own fee page.
What You File
Documents
- Board decision fixing the date of the general meeting
- The special resolution — or, for an increase in issued capital within the existing ceiling, the ordinary resolution
- तीन महले — the three-column sheet showing the existing clause, the amended clause and the reason (Directive §25(c))
- Amended memorandum and articles, 2 copies, signed by a majority of directors
- Sector regulator’s consent where applicable — SEBON, Nepal Rastra Bank, Insurance Authority
- For a paid-up increase, a bank statement evidencing that the money came in
- The differential fee
A private company can take the resolution without convening anything: Section 149(1) allows any resolution, special included, to be passed by a written resolution signed by all shareholders representing at least 75% of the voting shares, unless the articles say otherwise.
Timeline: 3 days under the Citizen Charter — and capital-change applications have been auto-approved in CAMIS since Release 1.4, dated 2083/02/04, with the memorandum and articles amendment recorded in the same approval letter.
Going the Other Way Needs a Court
Reducing capital is not the mirror image of increasing it. Section 57 requires a court order, and OCR’s Citizen Charter says so explicitly. If you have set your authorised capital far higher than you need — which people do, to look substantial — you cannot quietly bring it down later. The fee you paid on the way up is also not refunded.
Practical consequence: set authorised capital to what you actually expect to need. Raising it later costs only the differential and three days. Lowering it costs a court proceeding.
Two Things That Will Block the Filing
Arrears
The Citizen Charter repeats for every alteration service that a company behind on its filings must bring them up to date and pay the Section 81 fine as part of the alteration. You cannot raise capital while your annual returns are outstanding — see bringing a company up to date and annual compliance.
Unconsolidated documents — Directive §95(nya)
A company that has amended its memorandum or articles two or more times must consolidate them into a single clean text in OCR’s system, with a directors’ declaration that the consolidated text does not differ from the amendments made, plus its official mobile number and its directors’ National ID numbers. Sub-rule (8) allows the Office to refuse to record any other particulars until that is done. A capital increase is exactly the kind of filing that gets held up by it.
Frequently Asked
What is the government fee to increase authorised capital in Nepal?
The registration fee for your new total authorised capital, minus the fee you have already paid — a differential, set by the Nepal Gazette notification of 2064.02.14. The underlying scale is NPR 1,000 up to NPR 1,00,000 of authorised capital, NPR 4,500 up to NPR 5,00,000, NPR 9,500 up to NPR 25,00,000, NPR 16,000 up to NPR 1,00,00,000, and NPR 3,000 for each additional crore. Percentage formulas such as “0.5% of the increase” appear in several widely-read guides and have no basis in the fee schedule.
Do I need a special resolution to increase paid-up capital in Nepal?
Not if you are staying within your existing authorised capital. Section 56(5) of the Companies Act 2063 allows a company to increase its issued capital up to the limit of its authorised capital by an ordinary resolution. A special resolution under Section 56(1)(a) is needed only to raise the authorised ceiling itself by creating new shares.
What is the deadline to file a share allotment in Nepal?
Thirty days from the allotment, under Section 31(1) of the Companies Act 2063. This is separate from recording the capital increase itself and is the deadline most often missed, because the capital increase feels finished once OCR records the new authorised figure. Late filing attracts the Section 81(6) fee of NPR 200 per month, capped at NPR 1,000 per financial year.
Can I reduce my company authorised capital in Nepal?
Only with a court order. Section 57 of the Companies Act 2063 governs capital reduction and OCR’s Citizen Charter states the court requirement explicitly. Fees already paid on the way up are not refunded, which is a reason to set authorised capital realistically at incorporation rather than inflating it.
About this guide. Sections 21, 31, 56, 57, 81 and 149 are from the Companies Act 2063 as consolidated to the 2081 amendment and published by the Office of the Company Registrar. Fee rules are from the Nepal Gazette notification of 2064.02.14, reproduced on OCR’s revenue page; document lists from the Citizen Charter and §25 of the कम्पनी निर्देशिका 2072; auto-approval from the CAMIS Release 1.4 notice of 2083/02/04. The thirty-day reading of Section 21(2) for a Section 56 filing is our reading, flagged as such, because the Act does not state a deadline in terms. Confirm current fees with the OCR before relying on any figure.
Raising Capital for Your Company?
We work out which resolution you actually need, compute the differential fee from the Gazette scale, file the amendment and the return of allotment inside the thirty days — and check first whether anything on your file would block it.
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