Nepal’s 2026 E‑Invoicing Mandate for VAT‑Registered Businesses: Compliance Steps, Software Options and Deadlines

Starting in 2026 the Inland Revenue Department (IRD) requires every VAT‑registered business in Nepal to issue electronic invoices that meet a new technical standard. The move is part of a broader push to tighten tax collection, reduce paper fraud and give the revenue authority real‑time visibility into sales transactions. If you run a company that files VAT returns, the changes affect you directly — whether you issue a handful of invoices a month or thousands.

What the mandate covers

The rule applies to all taxpayers who hold a VAT registration number, regardless of turnover. The IRD notice does not set a separate revenue threshold; the only exemption is for businesses that are not required to register for VAT in the first place. The fiscal year 2026‑27 began in mid‑July 2026, but the IRD has deferred the mandatory live‑invoicing start date. A forthcoming gazette notice will announce the exact go‑live day. As of 14 September 2026 the IRD e‑invoicing portal is open for registration and the registration deadline has not yet been fixed; businesses should register now and monitor the official IRD website and the Nepal Gazette for the final date.

Technical specifications you must meet

IRD has published a data‑format specification that every e‑invoice must follow. The key requirements are:

• Format: JSON (preferred) or XML, both validated against the IRD schema.
• Mandatory fields: supplier PAN, buyer PAN, invoice number, invoice date, line‑item description, quantity, unit price, taxable value, VAT rate, VAT amount, total amount, and a unique invoice reference (UUID).
• Digital signature: Each invoice must be signed with the taxpayer’s private key issued by a licensed Certifying Authority in Nepal.
• QR code: A QR code containing the invoice reference, supplier PAN, buyer PAN, invoice date and total amount must be printed or embedded on the PDF version sent to the buyer.
• Transmission: Invoices are pushed to the IRD central platform via a RESTful API (HTTPS, OAuth2 authentication). Real‑time submission is required for B2B invoices; B2C invoices may be batched once daily, provided the batch is uploaded before midnight of the same business day.

IRD‑certified software options

IRD maintains a public list of certified e‑invoicing solutions. The list is updated quarterly, so always download the latest version before you commit. Before purchasing, verify the vendor’s certificate number on the IRD portal and test the API sandbox with a few sample invoices.

Step‑by‑step compliance checklist

1. Register on the IRD e‑invoicing portal. Use your VAT PAN and the mobile number linked to your tax account. You will receive a client‑id and client‑secret for API access.
2. Obtain a digital signing certificate. Apply to a licensed Certifying Authority (e.g., National Information Technology Center (NITC) or other CAs accredited by the Office of the Controller of Certification) and install the private key on the machine that will generate invoices.
3. Configure your chosen software. Enter the IRD API endpoints, client credentials, and certificate details. Map your chart of accounts to the mandatory invoice fields.
4. Run a pilot. Issue 5‑10 test invoices in the sandbox environment, verify that the IRD portal returns a successful acknowledgement and that the QR code scans correctly.
5. Go live. Switch to the production endpoint on the official start date (to be announced). For B2B sales, each invoice must be submitted instantly; for B2C you may accumulate and upload a daily batch.
6. Retain records. Keep the signed JSON/XML, the PDF with QR code, and the IRD acknowledgement for a minimum of five years, as required by the Income Tax Act.

Deadlines and penalties

The IRD notice outlines three key dates:

• Portal registration deadline – to be announced in the upcoming circular; missing it means you cannot submit invoices electronically.
• First live invoice submission – will be set by a future gazette notice; the fiscal year 2026‑27 has already begun, but the mandatory go‑live date has been deferred.
• Ongoing filing frequency – real‑time for B2B, daily batch for B2C; monthly VAT return filing remains unchanged.

Penalties for non‑compliance are prescribed in the existing VAT Act. Because the exact penalty schedule may be amended, consult the latest IRD circular or your tax advisor before the deadline.

Final thoughts

Moving to e‑invoicing is a significant operational shift, but the technical barrier is manageable if you start early. Pick a certified solution that fits your volume, run a thorough sandbox test, and keep your digital certificate secure. Staying ahead of the registration window will save you from last‑minute scrambling and potential fines. Bookmark the IRD e‑invoicing page, subscribe to their notification email list, and schedule a quarterly review of your compliance workflow — tax rules in Nepal evolve quickly, and a proactive habit is the best safeguard.