IRD to intensify surveillance on personal financial transactions of investors and directors

KATHMANDU: The Inland Revenue Department (IRD) of Nepal is set to increase surveillance on the personal financial transactions of investors and directors. This move comes in addition to monitoring the institutional transactions of industrial and business establishments.

The government has decided to implement stricter measures following the discovery of tax evasion practices where business transaction funds were being deposited and used in personal accounts. The IRD has announced that from the upcoming fiscal year, it will rigorously enforce the rule prohibiting the deposit of business transaction funds into personal accounts.

To implement this regulation, the IRD is preparing to monitor the personal financial details of company directors.

According to sources, once the new rule is in place, the department will enhance surveillance based on the available data. Monitoring will commence from sectors identified as high-risk starting from the next fiscal year.

Recent investigations revealed that businesses such as restaurants, hotels, and establishments dealing directly with consumers were depositing business transaction funds into personal accounts. Significant transactions were also being settled through personal accounts. These findings emerged during investigations by the Revenue Investigation Department and the police, prompting the IRD to introduce the new regulation.

To enforce the rule prohibiting personal financial transactions for business activities, monitoring will extend to bank accounts, mobile numbers, and wallet accounts of the concerned individuals.

The IRD is planning to treat the personal financial details of directors as part of the company’s financial information for monitoring purposes. Officials believe it will not be difficult to monitor these details as most of the information is already being submitted.

This new measure aims to ensure that business transaction funds are used appropriately and that tax obligations are met, thereby reducing tax evasion and increasing transparency in financial dealings.