Nepal's income tax calculator is an essential tool for salaried employees, business owners, and professionals filing their Personal Income Tax (PIT) return with the Inland Revenue Department (IRD). The tax system in Nepal uses progressive slabs with several deductions available — including SSF contributions, life insurance premiums, and medical insurance — that can meaningfully reduce your tax liability.
This guide covers Nepal's FY 2081/82 (2024-25) tax slabs for individuals, all major deductions available, and a complete step-by-step worked example showing how to calculate your actual tax payable.
Calculate Your Nepal Income Tax for FY 2081/82
Enter your salary and deductions to get your exact taxable income and tax payable under current Nepal rates.
Nepal Income Tax Slabs for FY 2081/82 (Individual)
For Single/Individual Taxpayers
| Taxable Income (NPR) | Tax Rate |
|---|---|
| Up to 5,00,000 | 1% |
| 5,00,001 – 7,00,000 | 10% |
| 7,00,001 – 10,00,000 | 20% |
| 10,00,001 – 20,00,000 | 30% |
| Above 20,00,000 | 36% |
For Married/Couple Taxpayers
The threshold for the 1% slab increases to NPR 6,00,000. All other slabs shift proportionally. Couples filing jointly benefit from the higher exemption threshold.
Additional 20% surcharge
A 20% surcharge applies on income exceeding NPR 50,00,000 per year (ultra-high earners).
Available Deductions Under Nepal Income Tax
1. SSF (Social Security Fund) Contribution
Employee contributes 11% of basic salary; employer contributes 20%. The employee's 11% SSF contribution is fully deductible from gross income.
2. Life Insurance Premium
Up to NPR 25,000 deductible (or actual premium paid, whichever is lower) for life insurance policies with Nepali insurers.
3. Medical Insurance
Up to NPR 20,000 deductible for health insurance premiums paid to Nepali insurance companies.
4. Pension/Provident Fund
Employee contribution to recognised provident fund (Citizens Investment Trust, provident fund) is deductible subject to limits.
| Deduction Type | Maximum Deduction (NPR) |
|---|---|
| SSF Employee Contribution (11%) | Actual amount (no cap) |
| Life Insurance Premium | 25,000 |
| Medical Insurance | 20,000 |
| Remote Area Allowance | 50,000 (if applicable) |
Worked Example: Nepal Income Tax Calculation FY 2081/82
Employee: Single | Annual Basic Salary: NPR 6,00,000 | Total Package (with allowances): NPR 9,00,000
Step 1: Calculate Gross Taxable Income
Gross salary: NPR 9,00,000
Step 2: Subtract Deductions
SSF (11% of basic): NPR 66,000
Life insurance premium: NPR 15,000
Medical insurance: NPR 10,000
Total deductions: NPR 91,000
Step 3: Calculate Net Taxable Income
9,00,000 - 91,000 = NPR 8,09,000
Step 4: Apply Tax Slabs
| Income Band | Amount | Rate | Tax |
|---|---|---|---|
| Up to 5,00,000 | 5,00,000 | 1% | 5,000 |
| 5,00,001–7,00,000 | 2,00,000 | 10% | 20,000 |
| 7,00,001–8,09,000 | 1,09,000 | 20% | 21,800 |
Total Tax: NPR 46,800 | Monthly TDS: NPR 3,900
How to File Income Tax Return in Nepal
Filing Deadline
Individuals must file annual tax returns by Poush end (mid-January) for the previous fiscal year (Shrawan–Ashadh). Late filing attracts penalty of NPR 100/day.
Filing Process
- Register on IRD portal (ird.gov.np) with PAN
- File online via the e-TDS/Taxpayer Portal
- Salaried employees with only employment income — employer files TDS; employee may not need to file separately unless other income exists
- Self-employed, business income, property income — must file ITR (Form IT-101)
How to Use the Tool (Step by Step)
- 1
Open the tool
Visit the on ToolsArena.
- 2
Enter your values
Fill in the required fields with your data.
- 3
View results
See calculated results instantly — no signup needed.
Frequently Asked Questions
What is the income tax rate in Nepal for FY 2081/82?+−
Nepal uses progressive tax slabs for FY 2081/82: 1% up to NPR 5 lakh, 10% on the next NPR 2 lakh (5–7 lakh), 20% on NPR 7–10 lakh, 30% on NPR 10–20 lakh, and 36% above NPR 20 lakh. Married couples get a higher threshold of NPR 6 lakh at 1%.
How much SSF does an employee pay in Nepal?+−
Under the Social Security Fund (SSF) scheme, employees contribute 11% of basic salary and employers contribute 20%. The total SSF contribution is 31% of basic salary. The employee's 11% contribution is tax-deductible. SSF replaced the old Provident Fund + Gratuity system for many employers.
Is there a personal income tax exemption limit in Nepal?+−
Nepal does not have a zero-tax exemption band — even income below NPR 5 lakh is taxed at 1%. After deductions (SSF, insurance premiums), the effective first rupee of taxable income is taxed at 1%. This is very different from India's system where income below ₹3 lakh is completely exempt.
Do I need to file a tax return if my employer deducts TDS in Nepal?+−
If your only income is employment income and your employer correctly deducts TDS each month, you technically satisfy the basic obligation. However, if you have rental income, business income, interest income, or capital gains from NEPSE — you must file a separate ITR. Filing voluntarily also helps claim refunds if excess TDS was deducted.
What is the tax on NEPSE capital gains in Nepal?+−
Capital gains from NEPSE share sales are subject to a flat capital gains tax: 5% for long-term gains (shares held more than 365 days) and 7.5% for short-term gains (365 days or less). This CGT is collected at source by the broker and does not need to be separately reported in most cases.
Calculate Your Nepal Income Tax for FY 2081/82
Enter your salary and deductions to get your exact taxable income and tax payable under current Nepal rates.
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