Methodology - Nepal (FY 2082/83)

Educational model - not an IRD assessment, not a tax return, not tax advice. Currency NPR. Fiscal year 2082/83 BS (mid-Jul 2025 to mid-Jul 2026).

Employee

Income tax is progressive on annual taxable income, with different slabs for an individual vs a married couple (selectable). Individual: 1% to NPR 500,000; 10% to 700,000; 20% to 1,000,000; 30% to 2,000,000; 36% to 5,000,000; 39% above. Couple: the bottom three thresholds widen to 600,000 / 800,000 / 1,100,000. The 36% and 39% bands are the 30% base rate plus a 20% / 30% surcharge.
The first slab's 1% is a Social Security Tax (SST), waived for an employee who contributes to the SSF (or an approved retirement fund). This model assumes SSF membership by default (first slab 0%); untick the SSF option to apply the 1% SST and drop the SSF contributions.
SSF: employee 11% + employer 20% of basic salary (assumed 60% of gross - an employer-defined ratio in practice). The employee 11% is deductible from taxable income, capped at the least of (actual, one-third of assessable income, NPR 500,000).
Out of scope: the 10% tax rebate for a woman filing individually, EPF/CIT alternatives to SSF, and the exact basic-salary ratio.

A natural person carrying on business uses the same progressive slabs on net profit (revenue minus deductible expenses), but the first slab is 0% - the 1% SST never applies to business income. The surcharge bands (36% on NPR 2-5M, 39% above 5M) apply identically; the individual/couple selector still applies.
SSF for the self-employed is a voluntary self-contributor scheme and is excluded by default.
Out of scope: presumptive D01 tax (turnover up to NPR 3M), turnover tax (0.25-2%), and the 5% foreign-currency freelance final withholding - these are separate natural-person business regimes.