NEPSE Capital Gains Tax 2026: What the New 7.5% & 10% Rates Mean for Your Portfolio

Ramesh sold 200 shares of a commercial bank stock in late July 2026, eight months after buying them. He had done this trade before, so he already knew roughly what to expect on his contract note: brokerage, a small SEBON fee, and a capital gains tax line equal to 7.5% of his profit, the short-term rate he had memorised from his last few trades. Instead, the CGT line came out higher than his own mental math. Nothing was wrong with the deduction. What was wrong was his assumption, because two weeks earlier, on Saun 1, 2083, the short-term rate had quietly become 10%.

That two and a half percentage point jump is small enough to miss and large enough to matter, especially if you trade often or hold a large position. This guide works through the new rates from the ground up: what changed, who it actually applies to, the exact formula your broker uses, a full worked example with real numbers, and the specific situations, bonus shares, IPO allotments, losses, where the rules get less obvious than a single headline percentage suggests.

This table covers resident individual and entity categories only. Non-resident Nepali (NRN) taxation follows separate treaty and residency rules not covered here. Everything below this point focuses on the resident individual case, since that covers the overwhelming majority of retail NEPSE traders.

What Changed: NEPSE CGT Before and After July 2026

Through the end of FY 2082/83, a resident individual selling listed NEPSE shares paid 7.5% capital gains tax on profit from shares held 365 days or less, and 5% on profit from shares held longer than that. The Finance Act 2083/84 raised both figures, effective Saun 1, 2083 BS, which fell in the third week of July 2026 on the Gregorian calendar. The short-term rate went from 7.5% to 10%. The long-term rate went from 5% to 7.5%. In both cases that is a 2.5 percentage point increase, and the government also confirmed the deduction continues to apply as a final tax, meaning there is no additional income tax stacked on top once your broker withholds it.

Notice that the gap between short-term and long-term is unchanged at 2.5 percentage points. Patience is exactly as valuable, in relative terms, as it was before this change. What is different is that both numbers now sit on a higher base, so the absolute rupee cost of selling short-term versus long-term on a large profit has grown too, which we will work through with real figures shortly.

The CGT Formula, in Plain Terms

Capital gains tax on a NEPSE trade is not a percentage of the price difference between what you paid and what you sold for. It is a percentage of your net profit, calculated after every other cost of the trade has already been subtracted. Missing this distinction is one of the most common reasons an investor's mental estimate does not match the actual number on their contract note.

Two things follow directly from this formula. First, CGT never applies to a loss, only to a positive net profit, so a losing trade generates zero CGT regardless of how the market moved. Second, because brokerage, the SEBON fee, and the DP charge are all subtracted before the tax rate is applied, your effective tax burden as a share of your raw price gain is always a little lower than the headline percentage suggests, since the tax base itself is already smaller than the sticker-price gain.

Worked Example: A Real Trade, Step by Step

Numbers make this concrete faster than another paragraph of rules. Here is a full short-term trade, 200 shares bought at Rs 850 and sold at Rs 1,020 roughly nine and a half months later, walked through every deduction in order.

Brokerage figures use the SEBON-regulated tiered schedule for transaction sizes in the Rs 50,001–5,00,000 range. Larger or smaller trades fall into different brokerage tiers, covered in the cost stack section below.

Five More Scenarios: Small, Medium, Large, Long-term, and a Loss

One example rarely covers every situation an investor actually faces. Here are five more, spanning trade size, holding period, and an outcome that is not a profit at all.

All figures use the current SEBON brokerage schedule and the 2026 CGT rates. The loss-making example pays zero CGT since tax only applies to positive net profit; it does not reduce the loss itself.

Same Rupee Profit, Very Different Tax

Because the rate depends on who you are and how long you held the shares, two investors with the exact same rupee profit can owe meaningfully different amounts of tax. Here is what Rs 1,00,000 of profit costs across the categories that commonly come up.

^*Entity and company share taxation in Nepal often runs through general business income rules rather than the individual CGT scheme, and was not clearly confirmed as part of this specific reform. If you trade through a company structure, treat these two rows as a starting point for a conversation with a chartered accountant, not a settled answer.

How the Holding Period Is Actually Counted

Whether you pay 10% or 7.5% comes down entirely to one date comparison, so it is worth getting the counting method right rather than estimating. The holding period runs from your buy settlement date to your sell settlement date, not the date you clicked buy or sell in TMS. Because NEPSE settles on a T+3 cycle, your settlement date is a few working days after your trade date on both ends, which can shift your 365-day mark by up to a week compared to counting from trade dates alone.

For most secondary-market purchases this distinction is a minor adjustment. It matters more if you are selling right around the 365-day boundary, where a few days of miscounting can accidentally move you from long-term into short-term, or vice versa. If a sale is close to that line and the difference in rate matters to you, check your Mero Share transaction history for the actual settlement dates rather than relying on memory or your calendar app.

IPO Shares: The Clock Starts at Allotment

IPO shares work a little differently from a secondary-market purchase, and this trips up more new investors than almost any other holding-period question. The commonly understood rule is that your holding period for an IPO allotment starts from the allotment date, not the date the stock actually begins trading on NEPSE. Listing can happen weeks or months after allotment, so an investor who sells shortly after listing day may already be well past a year from their original allotment, or conversely may still be firmly in short-term territory even though the stock has been trading for a while. Your cost basis for an IPO allotment is simply the issue price you paid, since IPO applications through ASBA do not carry a brokerage fee on the buy side.

Bonus and Rights Shares: No Separate Cost Basis

Bonus and rights shares do not get their own purchase price for CGT purposes. Instead, your original investment amount is spread, or averaged, across your entire holding of that script including the new shares. If you originally held 100 shares at an average cost of Rs 1,000 each, a 20% bonus issue gives you 120 shares while your total cost stays the same, which lowers your average cost per share to roughly Rs 833. Sell any of those shares later and your taxable profit is calculated against that lower averaged cost, not your original purchase price, which means a larger slice of your eventual sale proceeds counts as profit and is taxed accordingly at the applicable 2026 rate.

Rights shares work the same way in principle but require an active decision and payment. If you exercise a rights offer, the amount you pay for the rights shares is added into your cost pool, raising your total invested amount and adjusting your average cost per share upward instead of downward. Keeping an accurate running total of your cost basis through your Mero Share portfolio statement is the only reliable way to know your correct taxable profit once bonus and rights adjustments have accumulated over several years.

What Happens When You Sell at a Loss

No capital gains tax applies to a loss. If your net proceeds after brokerage, SEBON fee, and DP charge come out below your total invested amount, the CGT line on your contract note will simply read zero, regardless of the 2026 rate change.

Where the answer gets genuinely less clear is what happens to that loss afterward. Some professional summaries of Nepal's current capital gains framework describe losses on NEPSE-listed shares as non-offsettable, meaning a loss on one script cannot be used to reduce the taxable profit on a gain from a different script or a different trade, under current practice. Other sources describe a carryforward provision that allows a capital loss to be set against a future capital gain, though not against other income like salary or business profit. This is a genuine inconsistency in publicly available guidance rather than something this article can responsibly resolve on your behalf. If offsetting or carrying forward a loss would materially affect your tax planning, confirm the current position directly with your broker's tax desk or a chartered accountant familiar with current Inland Revenue Department practice, rather than assuming either answer.

The Full Cost Stack, Recalculated for 2026

CGT is only one of four costs that separate your NEPSE trade's sticker price from what actually lands in your account. Brokerage and the SEBON fee apply on both the buy and sell side, the DP charge applies once on the sell side, and CGT applies last, only to a positive net profit.

Because brokerage is tiered and CGT depends on your specific holding period, the same percentage price move can produce quite different net returns depending purely on trade size and timing. Working through the exact figures for your own numbers, rather than a generic average, is the only way to know your real break-even point, the minimum sell price at which brokerage, fees and CGT are fully covered with zero net profit. Merokalam's NEPSE share calculator runs this exact formula, tiered brokerage and all, and shows your break-even price alongside the full cost breakdown for whatever buy price, quantity, and sell price you enter.

This preview mirrors the worked example above using the calculator's own output layout, not a captured image of the live tool. Enter your own buy price, quantity, and sell price on the calculator page to see this breakdown for your actual trade.

Who Deducts the Tax, and How

For a listed NEPSE share sold by a resident individual, you never calculate or pay capital gains tax yourself in the ordinary sense. Your broker's system calculates net profit automatically at the moment your sell order settles, applies the correct rate based on your holding period, deducts the amount, and remits it to the government as tax deducted at source. Since 2026, this deduction is treated as a final tax for resident individuals on listed shares, meaning it settles your tax obligation on that specific gain completely. You do not add it to your annual income tax return or owe anything further on it.

This automation is convenient, but it also means the responsibility for verifying the deduction is correct sits with you, not your broker. A system error, a misclassified holding period right at the 365-day boundary, or a wrong brokerage tier applied to an edge-case transaction size are all things that can happen, rarely, but not never.

Reading Your Contract Note

Every trade generates a TMS contract note, and it is the primary document for checking that your CGT deduction matches what the rules say it should be. A typical contract note shows the trade date, the settlement date, the stock, quantity and price, gross value, brokerage, SEBON fee, DP charge on sell-side transactions, and, for a profitable sale, a capital gains tax line. Compare the brokerage line against the tier your transaction value falls into, and compare the CGT line against 10% or 7.5% of your calculated net profit depending on your actual holding period from settlement to settlement. If a number looks off, raise it with your broker directly. Keep your contract notes on file regardless, since they are your supporting record if you ever need to demonstrate your cost basis or holding period.

2026 CGT vs Previous Years, at a Glance

If you are reading older material, including guides published before mid-2026, anywhere that quotes 7.5% or 5% for individual listed-share CGT is describing the previous fiscal year's rates. Tax rates in Nepal are set through each year's Finance Act, so treat any number without a clear effective date attached to it with some caution, and cross-check against the date this article and its sources were last verified.

What This Means for Your Portfolio

The direct effect of this change is arithmetic: your after-tax return on any profitable NEPSE trade is now 2.5 percentage points of your profit lower than it would have been under the previous year's rates, whether you sell short-term or long-term. On a small trade that is a rounding error. On a large or frequently-traded portfolio, run over a full year, it adds up to a real number worth accounting for in how you plan trades.

The relative incentive to hold past 365 days has not changed, since the gap between short-term and long-term is still exactly 2.5 points either way. What has changed is that the reward for patience is now measured against a higher short-term baseline, so the absolute rupee savings from waiting out the 365-day mark on a large profit are larger than they were last year, even though the percentage-point logic is identical. Revisit any trade you were planning to sell right around that boundary with the new numbers, not the old ones, before deciding whether a few extra days of waiting is worth it for your specific position.

10 Common Mistakes With the New CGT Rates

• Assuming the 10%/7.5% headline rate applies to unlisted shares or to a company structure, when a different rate may apply
• Counting the holding period from your trade date instead of your settlement date
• Using an old guide or memory that still quotes the 7.5%/5% rates from before mid-July 2026
• Forgetting that an IPO's holding period starts at allotment, not at listing day
• Using your original purchase price instead of your averaged cost basis after a bonus or rights issue
• Assuming a loss on one script automatically offsets a gain on another without confirming current practice
• Calculating CGT on the raw price difference instead of net profit after brokerage, SEBON fee, and DP charge
• Not checking the contract note's CGT line against the correct rate for your actual holding period
• Treating the broker's TDS deduction as optional or something to separately file and pay again
• Selling right at the 365-day boundary without double-checking settlement dates, when a few days either way changes the rate that applies

Frequently Asked Questions

Final Thoughts

The headline version of this story, a tax rate went up, is the least useful part of it. What actually matters for your portfolio is more specific: which category you fall into, how your holding period is counted from settlement dates rather than trade dates, how bonus and rights shares quietly change your cost basis over time, and how to read your own contract note well enough to catch an error rather than assume the deduction is automatically correct.

None of this changes what a good NEPSE trade looks like. It changes the after-tax number you should actually be comparing against your target return before you decide a trade was worth making. Run your own figures against your own buy and sell prices, rather than a generic example, and revisit any trade sitting close to the 365-day mark with the current rates in hand.