Contents
Personal Income Tax Rates - Resident Natural Persons
For FY 2083/84 (2026/27), Nepal uses a unified progressive slab schedule for resident natural persons. Separate individual and couple rate schedules are no longer used for this fiscal year.
| Annual taxable income (NPR) | Marginal rate |
|---|---|
| Up to 1,000,000 | 1% Social Security Tax* |
| 1,000,001 - 1,500,000 | 10% |
| 1,500,001 - 2,500,000 | 20% |
| 2,500,001 - 4,000,000 | 27% |
| Above 4,000,000 | 29% effective top marginal rate |
*The 1% first-band charge is Social Security Tax. Statutory exceptions can apply, including specified pension/retirement and Social Security Fund situations. Confirm eligibility against the current Finance Act and IRD guidance.
Corporate Income Tax Rates
| Entity / business category | Current rate |
|---|---|
| General business entity | 25% |
| Banks and financial institutions | 30% |
| General insurance business and specified financial businesses | 30% |
| Telecommunications and internet services, money transfer, capital-market and specified securities businesses | 30% |
| Cigarette/tobacco, liquor/beer and petroleum operations covered by the legislation | 30% |
| Public-trust (Guthi) school or college taxable income | 20% |
| Cooperatives on specified non-exempt transactions | 5%-20%, depending on type and local-government area |
Section 11 incentives and sector-specific concessions can reduce the effective tax rate for qualifying industries and activities. The applicable concession should be checked against the current IRD FY 2083/84 incentive publication before relying on a reduced rate.
Non-Resident and Foreign Permanent Establishment Rules
Nepal applies special rates to specified non-resident income and foreign permanent establishments. Under the current Schedule 1 framework, taxable income of non-residents covered by section 70 is generally subject to the prescribed special rate, while certain water transport, air transport or telecommunications services are subject to special percentage rates. Profit remitted abroad by a foreign permanent establishment is also subject to a separate tax.
Because the outcome depends on the nature and source of the payment, any applicable tax treaty, permanent-establishment status and withholding provisions, use the current IRD entity-rate and TDS schedules for the specific transaction.
Capital Gains Tax - FY 2083/84
| Transaction | Rate |
|---|---|
| Resident individual - listed securities held more than 365 days | 7.5% |
| Resident individual - listed securities held 365 days or less | 10% |
| Resident entity - listed securities | 10% |
| Resident individual - unlisted securities | 10% |
| Resident entity - unlisted securities | 15% |
| Natural person - land/private building owned 5 years or more | 7.5% of capital gain |
| Natural person - land/private building owned less than 5 years | 10% of capital gain |
| Specified land/building disposal by other persons under section 95A(6) | 1.5% of disposal value |
VAT Rate in Nepal
Nepal's standard Value Added Tax rate is 13%, subject to statutory exemptions and zero-rated supplies under the VAT Act and schedules. Registration thresholds and special rules vary by the nature of goods and services.
Taxpayers should check the current VAT Act, Finance Act amendments and IRD notices for exemptions, registration and filing obligations.
TDS / Withholding Tax
Withholding may apply to employment income, interest, rent, royalties, service fees, commissions, contracts, dividends, retirement payments and other prescribed payments. The correct rate depends on the payment type, recipient status and whether the withholding is final or adjustable.
Income Tax Return and Advance Tax Deadlines
Under section 96 of the Income Tax Act, a person required to file an annual income return generally submits it within three months after the end of the income year, subject to statutory exceptions and extensions.
For persons required to pay tax by instalment on business or investment income, the normal section 94 schedule is cumulative:
| Deadline | Cumulative estimated tax payable |
|---|---|
| End of Poush (approximately mid-January) | 40% |
| End of Chaitra (approximately mid-April) | 70% |
| End of Ashad (approximately mid-July) | 100% |
Separate rules apply to turnover-based taxpayers and to withholding/VAT returns.
Official Nepal Tax Resources
Inland Revenue Department, Nepal IRD - Current tax rates and incentives IRD - Income Tax Act, 2058 and amendments IRD - Income Tax Rules IRD - Acts, including Finance Act 2083 IRD - Capital gains tax resourcesOfficial external resources are provided within the article for verification; they are not included as navigation-menu items.
Important Note
Tax liability can depend on residency, source of income, industry classification, deductions, rebates, tax treaties, withholding treatment and fiscal-year-specific amendments. The rates above are a general reference for FY 2083/84 and should be checked against the latest IRD publication for the transaction concerned.