The plane which went down shortly after taking off from Nepal's capital Friday was hit by a bird, the pilot told air traffic controllers moments before the crash, according to Kathmandu airport.
"Immediately after the take off, the air traffic controllers noticed the aircraft making unusual manoeuvres. When the controller asked the pilot about it, he said the plane had struck a bird," Ratish Chandra Lal Suman, manager of Tribhuvan International Airport, told reporters.
"Shortly after, the aircraft crashed. All the bodies have been sent to hospital for post mortem examinations," he added.
Police say all 19 people on board the Sita Air craft were killed in the crash on the outskirts of Kathmandu, including seven Britons and five Chinese.
The twin-engine Dornier Fairchild 228 was flying to the town of Lukla, gateway to Mount Everest.
Witnesses described hearing the screams of passengers and seeing flames coming from one of the plane's wings moments before it hit the ground.
"The crash has caused the death of 12 foreigners, including seven British and five Chinese tourists. The remaining seven, including three crew members, are Nepalese," police spokesman Binod Singh told AFP, adding there were no survivors.
The spokesman said the plane had crashed less than one kilometre (half a mile) from the airport at around 6:30am (0045 GMT), next to the Manohara river.
"The pilots seem to have tried to land it safely on the banks of the river but unfortunately the plane caught fire," said Singh.
Tulasha Pokharel, a 26-year-old housewife who lives near the crash site, told AFP she was among the first on the scene.
"We could hear people inside the aircraft screaming, but we couldn't throw water at the plane to put out the fire because we were scared that the engines were about to explode," she said.
"The pilot tried his best to make an emergency landing. If he had managed it, then we could have rescued some of the passengers."
Police had initially said five Japanese, two Italians and a Briton were killed in the crash but later corrected the information, which had been given in error by an officer at the crash site.
Local television channels showed several hundred soldiers and police officers picking through the smouldering wreckage of the aircraft, which was a Dornier Fairchild 228.
A number of badly burned bodies were laid in a line a few metres from the craft's shattered fuselage, as a large crowd of shocked bystanders looked on.
Autumn is the peak climbing season in Nepal, which has eight of the world's 14 highest mountains, including Everest.
At least eight people were killed in an avalanche on Mount Mansalu in northwest Nepal on Sunday, with the search for a further three missing climbers given up on Thursday.
The plane accident is the sixth fatal air crash in Nepal in less than two years, with 76 lives lost in that period before Friday, raising fresh questions about the safety record of the country's numerous small airlines.
The wreckage of a Dornier aircraft, owned by private firm Sita Air, at the crash site in Kathmandu. Reuters/Navesh Chitrakar
The country has a poor road network and large numbers of tourists, pilgrims and professional climbers often rely on Nepal's 16 domestic airlines and 49 airports to reach remote areas.
Aircraft and pilots often have to contend with bad weather and difficult landing strips in the Himalayan nation.
In May, 15 people were killed when a small Agni Air plane taking tourists to a treacherous high-altitude airport near Nepal's Annapurna mountain region ploughed into the ground.
In September last year a small plane taking tourists on a sightseeing trip around Everest crashed into a hillside near the Nepalese Kathmandu, also killing all 19 people on board.
The Buddha Air Beechcraft plane, carrying 10 Indians, two Americans, one Japanese citizen and three local passengers, came down in heavy rain and fog at Godavari, about 10 kilometres from the capital.
Sita Air plane crashes in Nepal
A chronology of Nepal's accident prone airlines