Nepal income tax slabs

What are the income tax slabs for FY 2083/84?

FY 2083/84 taxes annual taxable income at 1% to NPR 10,00,000, 10% to NPR 15,00,000, 20% to NPR 25,00,000, 27% to NPR 40,00,000, 29% above NPR 40,00,000. The separate schedule for married couples was merged away, so a single table now applies to every resident individual with employment income. It applies from Shrawan 1, 2083 (mid-July 2026).

The last two columns are the part a rate table usually leaves you to work out. “Tax on this band” is the most that band alone can charge; “total to here” is the tax due on income that exactly fills it. Someone with NPR 15,00,000 of taxable income pays NPR 60,000 — the running total at the top of the second band.

How much tax at each level of income?

On FY 2083/84 rules: NPR 10,00,000 of taxable income is taxed NPR 10,000, NPR 15,00,000 is taxed NPR 60,000, NPR 25,00,000 is taxed NPR 2,60,000 and NPR 50,00,000 is taxed NPR 9,55,000. An SSF member pays NPR 10,000 less than each of those figures, up to the top of the first band.

Read the row for your taxable income, not your gross salary. The effective rate is the tax as a share of that income; the marginal rate is what the next rupee is taxed at, which is the number that matters when you are weighing a raise or an extra relief claim.

How the bands are actually applied

Each band taxes only the slice of income inside it, so a raise can never lower your take-home. On NPR 12,00,000 of taxable income you pay 1% on the first NPR 10,00,000 and 10% on the remaining NPR 2,00,000 — NPR 30,000 altogether, an effective rate of 2.5% against a marginal rate of 10%.

Two corrections that follow from this, and cost people money when they get them wrong: a bonus that pushes you into the next band is taxed at that band's rate only on the part above the threshold, and a relief claim saves you the relief multiplied by your marginal rate — not the whole premium.

What FY 2083/84 changed

Three things: the 1% band doubled from NPR 5,00,000 to NPR 10,00,000, the top rate fell from an effective 39% to 29%, and the separate couple schedule was merged into one table. At NPR 10,00,000 of taxable income the bill falls by NPR 75,000 a year.

The old 36% and 39% figures were never headline rates — they were the 30% band with a 20% and then a 30% surcharge stacked on top. FY 2083/84 removed the surcharges and replaced the six-band ladder with five.

Tax slabs for FY 2082/83 and FY 2081/82

Both years share one schedule: 1% on the first NPR 5,00,000 for an unmarried taxpayer (NPR 6,00,000 for a couple), then 10%, 20%, 30%, and the 30% band with a 20% surcharge above NPR 20,00,000 and a 30% surcharge above NPR 50,00,000. Useful for checking an old payslip or a reassessment.

What is the 1% Social Security Tax?

The 1% charged on the first band is the Social Security Tax, collected with income tax and deposited to a government social security account. Contributors to the Social Security Fund do not pay it — their SSF contribution already discharges the same obligation, so the band is charged at zero for them. Provident Fund members get no waiver.

• SSF member — first band charged at 0%. Worth NPR 10,000 a year once your taxable income fills the band.
• PF member, or no fund — the 1% applies in full.
• It is a tax, not a contribution. Unlike your PF or SSF, nothing is credited back to you in a balance you can withdraw.

Which fund an employer runs is therefore worth asking about before you accept an offer — the comparison tool prices the difference between two packages after this waiver is applied.

Which income do the slabs run on?

On annual taxable income: everything you are paid for the employment, plus your employer's retirement contribution, minus the reliefs you qualify for. Tax is assessed on the fiscal year as a whole, and your employer withholds a share of the yearly figure each month as TDS.

1. Assessable income— salary, grade, allowances, overtime, the festival bonus, and the employer's PF or SSF contribution.
2. Less relief — retirement contributions and CIT against one combined ceiling, then life and health insurance premiums against their own.
3. Taxable income — the figure every table on this page is read with.
4. Less rebate — 10% off the tax computed for a resident woman with employment income. It comes off the tax, not off the income.

The guide works through each step with a payslip in front of it.

Deduction ceilings and rebates

The ceilings have not moved across the three years on this page. PF, SSF and CIT share one relief ceiling of NPR 5,00,000a year — the employer's contribution counts towards it — with life insurance capped at NPR 40,000 and health insurance at NPR 20,000.

Questions people ask about the slabs

More of them, on the rules rather than the rates, in the full FAQ.

Sources and how these tables are produced

Every rate, ceiling and worked figure on this page is generated at build time from the same rule tables the calculator uses, under the Income Tax Act 2058 and the Finance Act for each year. Last reviewed on 3 August 2026.

• Inland Revenue Department, Nepal

  The authority for the rates, the TDS obligation and filing.

• Income Tax Act 2058 (2002)

  Schedule 1 sets the bands; §63 sets the retirement and insurance reliefs.

• Social Security Fund

  Contribution rates and the base ceiling behind the 1% waiver.