Nepal — Personal Income Tax (Individuals & Couples) — Skill v1.0

Produced by OpenAccountants (openaccountants.com). Research-grade (tier 2) for FY 2082/83 BS. Source provenance: figures derive from reputable Nepali professional-firm tax-fact publications (PKF T.R. Upadhya & Co., Baker Tilly Nepal) reflecting the Income Tax Act 2058 and Finance Act 2082 — they have not been re-anchored to primary IRD (ird.gov.np) / statute-section pages. A Nepali CA / registered tax practitioner must confirm each figure against the primary statute before reliance. Not tax advice.

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Section 1 — Quick reference

Field	Value
Country	Federal Democratic Republic of Nepal
Tax	Personal income tax (resident individuals & couples)
Currency	NPR (Nepalese Rupee) only
Income year (FY)	Shrawan 1 – Ashad end (Bikram Sambat); FY 2082/83 BS ≈ mid-July 2025 – mid-July 2026
Primary legislation	Income Tax Act 2058 (2002), as amended by the Finance Act 2082 (budget 29 May 2025)
Tax authority	Inland Revenue Department (IRD), Nepal — https://ird.gov.np
Taxpayer ID	PAN (Permanent Account Number)
First-band levy	1% Social Security Tax (SST) — separate IRD revenue account 11211
Validated by	Pending — requires sign-off by a Nepali CA / registered tax practitioner
Skill version	1.0

Resident individual — single (FY 2082/83)

Taxable income band (NPR)	Rate on band
First 500,000	1% (Social Security Tax)
Next 200,000 (500,001 – 700,000)	10%
Next 300,000 (700,001 – 1,000,000)	20%
Next 1,000,000 (1,000,001 – 2,000,000)	30%
Next 3,000,000 (2,000,001 – 5,000,000)	36%
Above 5,000,000	39%

Resident individual — couple (electing joint treatment, FY 2082/83)

Same schedule, but the first 1% band is NPR 600,000 (the +100,000 applies only to band 1). The 30% band therefore spans NPR 900,000.

Taxable income band (NPR)	Rate on band
First 600,000	1% (SST)
Next 200,000	10%
Next 300,000	20%
Next 1,000,000	30%
Next 3,000,000	36%
Above remainder	39%

Slabs are unchanged from FY 2081/82. Source: PKF Trunco "Tax Rates 2082-83"; Baker Tilly Nepal "Tax Fact 2025-2026"; Income Tax Act 2058 Schedule 1 (confirm primary).

Conservative defaults

Ambiguity	Default
Single vs couple election unclear	Apply single schedule (lower first band) and flag
Residency uncertain	Hard stop — residency drives worldwide vs source taxation (verify)
Marginal band borderline	Apply higher band on the disputed slice
Whether 1% SST applies	Apply 1% unless taxpayer is a sole proprietor / pensioner / SSF contributor (then exempt — see §3.3)

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Section 2 — Required inputs and refusal catalogue

Required inputs

Residency status; single vs couple election; employment vs business income; salary certificate / PAN; bank statements or books for business income; SSF membership status (affects the 1% SST); any TDS credit certificates.

Refusal catalogue

R-NP-IT-1 — Corporate return. Companies file under the corporate regime (25%/30%). Out of scope — use nepal-corporate-tax.

R-NP-IT-2 — TDS computation for a payer. Payer-side withholding is separate — use nepal-tds.

R-NP-IT-3 — Capital gains. Gains on shares/land have their own rates and advance-tax collection (Sec 95Ka). This skill states headline rates only; escalate detailed CGT.

R-NP-IT-4 — Payroll / SSF. Salary TDS sequencing + SSF contributions — use nepal-payroll.

R-NP-IT-5 — Non-resident / treaty. Non-resident taxation and DTAA relief require treaty analysis. Out of scope — escalate.

R-NP-IT-6 — Annual return due dates. The exact annual return filing deadlines under the Income Tax Act 2058 were NOT established by the research — VERIFY with the practitioner (flagged, not asserted).

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Section 3 — Tier 1 rules

3.1 Income year and charge

Income tax is charged under the Income Tax Act 2058 (2002), as amended by the Finance Act 2082. The income year runs Shrawan 1 to Ashad end (Bikram Sambat). Residents are taxed on worldwide income; non-residents on Nepal-source income (confirm residency/source rules).

3.2 Progressive rates

Apply the single or couple schedule in Section 1. The top marginal rate is 39% on income above NPR 5,000,000.

3.3 The 1% Social Security Tax (first band)

The 1% on the first band is a Social Security Tax, deposited to a separate IRD revenue account (code 11211). It does NOT apply to:

• sole proprietors (business income of a natural person),
• pension income,
• contribution-based pension fund income, or
• taxpayers who deposit into the Social Security Fund (SSF).

For those, the first band is effectively 0% (the 1% is removed), with the remaining bands unchanged. Source: PKF Trunco; Baker Tilly; corroborated by IRD revenue-code guides.

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Section 4 — Worked example (illustrative — confirm against current schedule)

Resident single individual, taxable income NPR 1,500,000, FY 2082/83, not an SSF contributor.

Band	NPR	Rate	Tax
First 500,000	500,000	1%	5,000
Next 200,000	200,000	10%	20,000
Next 300,000	300,000	20%	60,000
Next 500,000 (to 1,500,000)	500,000	30%	150,000
Total			235,000

If the same person were an SSF contributor, the first 500,000 would be at 0% (no SST), reducing tax by NPR 5,000.

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Section 5 — Filing and payment

• Income year: Shrawan 1 – Ashad end (BS).
• PAN required to file via IRD.
• Annual return + instalment (D-01/D-03) due dates: VERIFY — not established by the research; confirm against the Income Tax Act 2058 / IRD calendar.

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Section 6 — Conservative defaults

Situation	Default
Single vs couple unclear	Single schedule; flag
SSF-contributor status unknown	Apply 1% SST; flag to confirm exemption
Marginal band borderline	Higher band
Any figure flagged VERIFY	Flag for reviewer; do not finalise

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Section 7 — Sources

Research-grade, FY 2082/83 (verified by deep research, 2026-06). Secondary firm publications — re-anchor to primary IRD/statute before reliance:

1. PKF T.R. Upadhya & Co. — "Tax Rates 2082-83" — https://pkf.trunco.com.np/files/publications/1748841198_Tax%20Rates%202082-83_Final_250601_213028.pdf
2. Baker Tilly Nepal — "Tax Fact 2025-2026" — https://bakertilly.com.np/storage/download/1750310698_Tax_Fact_2025-2026.pdf
3. Income Tax Act 2058 (2002), Schedule 1 — confirm at https://ird.gov.np
4. Finance Act 2082 (budget 29 May 2025).

Known gaps / VERIFY: primary IRD/statute citations for each figure; residency test; annual return + instalment due dates; treaty positions.

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Prohibitions

• NEVER omit the 1% SST for a person who is NOT an SSF contributor / sole proprietor / pensioner; NEVER charge it where the SSF/sole-proprietor/pension exemption applies.
• NEVER use the single first band (500,000) for a couple electing joint treatment — theirs is 600,000.
• NEVER present these figures as primary-IRD-confirmed — they are firm-publication-derived; flag for the verifier to re-anchor.
• NEVER assert annual return due dates or residency tests this skill flags as VERIFY.
• NEVER file or instruct filing — produce a working paper for a Nepali practitioner to review.

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Disclaimer

This skill and its outputs are for informational and computational purposes only and do not constitute tax, legal, or financial advice. All outputs must be reviewed and signed off by a qualified Nepali professional (Chartered Accountant / registered tax practitioner) before filing or acting upon. The latest verified version is maintained at openaccountants.com.

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