Tax Rate in Nepal 2082/83 (2025): Complete Guide for All

Taxation is a key pillar of financial governance in Nepal. With the announcement of the fiscal year 2082/83 (2025/26) budget, the government has introduced several clarifications, relief measures, and new tax rules aimed at simplifying compliance and promoting economic growth. Whether you're a salaried employee, freelancer, business owner, startup founder, or foreign investor, understanding the updated tax rates and regulations is essential.

In this comprehensive guide, we explain the updated tax rates in Nepal for FY 2082/83—covering individuals, freelancers, corporations, and small businesses. We also explore the latest rebates, exemptions, and strategic tips to help you plan your taxes smarter.

1. Personal Income Tax Rates in Nepal FY 2082/83

Nepal follows a progressive tax system, meaning the higher your income, the higher the rate you pay—but only on the portion exceeding each slab.

1.1 Income Tax Slabs (Residents)

Note: The 1% Social Security Tax (SST) is waived if you are already contributing to Nepal’s Social Security Fund (SSF).

1.2 Example: Single Person With NPR 1,800,000 Income

Let’s say your annual income is NPR 1,800,000, and you are filing as a single person:

• First NPR 500,000 → 1% Social Security Tax = NPR 5,000
• Next NPR 200,000 → 10% = NPR 20,000
• Next NPR 300,000 → 20% = NPR 60,000
• Next NPR 1,000,000 → 30% = NPR 300,000

Total Tax = NPR 5,000 + 20,000 + 60,000 + 300,000 = NPR 385,000

If you contribute to the Social Security Fund (SSF), the 1% SST (NPR 5,000) is waived, reducing your total tax to NPR 380,000.

1.3 Female Taxpayer Rebate

A woman with her own PAN filing individually is entitled to a 10% tax rebate on her computed income tax.

Example:

• Calculated tax: NPR 25,000
• Rebate: 10% of 25,000 = NPR 2,500
• Net Tax = NPR 22,500

2. Income Tax Deductions and Allowances

To reduce taxable income, residents can claim legal deductions:

3. Tax Rules for Freelancers in Nepal

The government has simplified the tax process for freelancers earning in foreign currency.

3.1 Flat 5% Final Tax

Freelancers pay a flat 5% final tax on foreign income received through banks. No need to file returns or register a business if total annual income is below NPR 4 million.

Example:
You receive NPR 100,000 from a foreign client. Your bank deducts 5% = NPR 5,000. The remaining NPR 95,000 is yours. This tax is final—no further compliance is needed.

3.2 PAN Linking is Mandatory

Ensure your PAN is linked to your bank account, so the tax is recorded in your name.

3.3 Over NPR 40 Lakhs?

If freelance income exceeds NPR 4 million annually:

• File tax return (Form D4)
• Possibly register as a business
• Maintain records

4. Corporate Tax Rate in Nepal FY 2082/83

4.1 Standard Rates

4.2 Export-Oriented IT Companies

• Special industry rate: 20%
• Export rebate: 75% (on income from export)
• Effective tax = only 5% on net profit

4.3 Startup Tax Holiday

Startups with annual turnover under NPR 10 crore enjoy:

• 0% tax for 5 years (from date of operation)
• Enacted under the Economic Act 2080/81

4.4 Additional Rebates

5. Taxation for Small & Micro Businesses

5.1 Presumptive Tax

For small businesses with:

• Annual turnover < NPR 30 lakhs
• Annual profit < NPR 3 lakhs
• Not claiming tax credit or VAT

New Rule FY 2082/83: If your business had zero transactions, you pay zero tax.

5.2 Turnover-Based Tax (30L–1Cr)

Note: Lawyers, doctors, auditors, consultants, engineers, and athletes cannot use presumptive or turnover-based tax methods.

6. Non-Resident Taxation in Nepal

Non-residents are taxed only on Nepal-sourced income, and they cannot claim deductions available to residents.

7. Additional Announcements and Tax Reforms

The FY 2082/83 budget introduced reforms for:

Digital Services & E-Invoice

• Digital transactions now included under expanded Digital Service Tax.
• Nationwide rollout of central e-invoicing system.

Startup Incentives

• No tax for 5 years for startups under NPR 10 crore turnover.
• Subsidies and rebates for IT firms, renewable energy producers, EV manufacturers, and organic product makers.

Import Duties and Customs

• 1% customs duty on:
  • EV charging equipment
  • Tunnel boring machines
  • Sports infrastructure machinery
• Full duty waivers for green hydrogen & solar storage tech

8. Key Takeaways: Navigating Tax in Nepal

• Salaried Employees: Use deductions smartly (insurance, EPF, CIT)
• Freelancers: Flat 5% final tax if income < NPR 40 lakhs
• Startups: Enjoy 5-year tax holiday under NPR 10 crore turnover
• Small Businesses: Use presumptive or turnover-based taxation
• IT Exporters: Effective tax as low as 5%
• PAN is your tax identity—keep it updated!

Conclusion: Be Smart, Stay Compliant

The tax rate in Nepal for FY 2082/83 offers both clarity and opportunity. With final tax rules for freelancers, startup exemptions, and progressive slabs for individuals, it's easier than ever to plan your finances wisely.

At Notary Nepal, we specialize in notary certification and document translation services. Whether you're a digital nomad, salaried professional, or business owner preparing documents for tax, visa, or legal use, our team ensures your paperwork is accurately translated, properly notarized, and fully compliant with Nepali legal standards.