Capital gain tax on sale of shares in Nepal

Government of Nepal had amended the tax rate for the capital gain on the sale of stock. Here we will learn about the Capital gain tax on sale of shares in Nepal.

Capital gain tax on sale of shares in Nepal

Following is the detail information.

Capital Gain

Capital gain is the increase in value of asset and realized when it is sold. 

How to calculate Capital Gain ? 

It is calculated as follow : 

Capital Gain: Increased priced Stock – Cost price of stock.

What is rate of Capital Gain Tax ?

According to the provision, individual investors selling shares before one year of purchase need to pay 7.5%. On the other hand, one who is holding the share for more than a year need to pay 5% on capital gain. 

The rate was effective from Shrawan 01,2078. 

Similarly, it has distinguish the individual investor into short term traders and long term investor. This is the first time government has decided to charge a capital gain tax on the basis of holding period.

How much tax do I pay if I sell my share ?

For example: 

If you buy share of 10 unit of Nabil Bank from secondary market at Rs.1200.

Total amount:            10*1200= Rs. 12,000.

Broker commission (0.4%):       Rs.48       

(Amount is less than 50,000)

SEBON Fee ( 0.015%)                Rs. 1.8

DP charge :                                   Rs: 25

                         Total cost: Rs. 12,074.8

                  Actual price per share: 1207.48

Calculation of Profit and capital Gain tax:

If you sell 10 unit for Rs. 1500.

Total Amount:  10*15 = Rs. 15000

Broker commission: (0.4%) =  Rs. 60

(Amount is less than 50,000)

SEBON Fee (0.015% )           = Rs. 2.25

DP Charge:                             = Rs. 25

  Net Amount:                      = Rs. 15000- Rs. 87.25= Rs. 14,912.75

Profit:                                   = Rs. 14,912.75 – Rs. 1207.48 = Rs. 2837.95

 Tax on Profit:

 a. For trader holding stock for less than 1 year:

               = Rs. 2837.95*7.5% = Rs. 212.85

Net amount you get: Rs. 14,912.75 -212.85 = Rs. 14,699.90

b. For trader holing the stock for more than 1 year:

                    = Rs. 2837.95*5% = Rs. 141.90

Net amount you get : Rs. 14,912.75- 141.90 = Rs. 14,770.85

Frequently Asked Question

How is capital gain tax calculated on shares in Nepal?

= As we mention above, we can calculate capital gain tax on share in Nepal.

How much tax do you pay on capital gains on sale of shares?

= If you make profit than you have to pay 5% on the profit of sale of shares.

How do you calculate capital gains on sale of shares?

= Example for calculation of capital gains on sale of shares is given here.

How much money is deducted while selling share in Nepal?

= The brokers deduct the commissions, and capital gain tax you make profit on sale of the share.