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NCELL Deposited Rs9.96 billion as capital gain tax

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Succumbing to steady pressure from various stakeholders, Ncell, a privately owned telecom company, on Sunday filed the tax return and paid 15 out of 25 percent of capital gains tax (CGT) on the behalf of its previous owner TeliaSonera.

Ncell has paid such 15% tax under section 95(ka) of Income tax Act, 2058.
Referring to the schedule of income tax act, 25% tax will be leived on non-resident income sourced in nepal however 15% should be paid as advance tax during transaction date (with 25th of next month) which falls under primary liability of a company whose share has been transferred and remaining need to be paid at the time of final tax settlement with tax return by the Gainer.

Chief of Large Taxpayer’s Office (LTO) Shova Kanta Poudel says:
“We will recover the remaining 10 out of 25 percent of CGT from TeliaSonera,” “We will reach out to them through Axiata, the current owner of Ncell.”

The LTO had initially written to TeliaSonera, asking it to submit tax details, but the company argued the deal is not taxable in Nepal. Following such answer from TeliaSonera, the LTO asked Ncell to file tax return by May 7.
“As Ncell filed the TDS we have won the argument in principle,” said Poudel. “However, lot more needs to be done at operational level,” said the LTO chief, indicating to an investigation of Ncell’s declaration by the tax office.

In a statement released on Sunday, Ncell said it has responded positively to the LTO directive and made a deposit of 15 percent of the gains of TeliaSonera arising from the sale of shares of offshore company Reynolds Holding--the 80 percent shareholder of Ncell--to Axiata.

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