Every salaried employee in Nepal asks the same question when they get their payslip: why is the actual amount less than what was agreed? The answer is SSF, TDS, and income tax. This guide breaks down every deduction for FY 2082/83 (2025/26 AD) so you know exactly what you will take home.
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Try this free toolNepal income tax slabs for FY 2082/83
The Inland Revenue Department (IRD) Nepal uses progressive tax slabs. You pay a higher percentage only on the portion of income that falls in each slab — not on your entire salary.
For unmarried individuals (single)
| Annual taxable income | Tax rate |
|---|---|
| Up to रू 5,00,000 | 1% (social security tax) |
| रू 5,00,001 to रू 7,00,000 | 10% |
| रू 7,00,001 to रू 10,00,000 | 20% |
| रू 10,00,001 to रू 20,00,000 | 30% |
| Above रू 20,00,000 | 36% |
For married couples (joint filing)
| Annual taxable income | Tax rate |
|---|---|
| Up to रू 6,00,000 | 1% |
| रू 6,00,001 to रू 8,00,000 | 10% |
| रू 8,00,001 to रू 11,00,000 | 20% |
| रू 11,00,001 to रू 20,00,000 | 30% |
| Above रू 20,00,000 | 36% |
Married couples get an extra रू 1,00,000 of income at each lower slab — this is a meaningful saving if both spouses file together.
SSF deduction — 11% of basic salary
The Social Security Fund (SSF) is mandatory for all permanent employees in Nepal under the Contribution-Based Social Security Act. Here is how it works:
- Employee contributes: 11% of basic salary every month
- Employer contributes: 20% of basic salary (on top of your salary)
- Total SSF pool: 31% of basic — but only 11% comes out of your pocket
Your SSF contribution is deductible from your taxable income, which reduces your tax burden. If your basic salary is रू 50,000, your monthly SSF deduction is रू 5,500 and annual deduction is रू 66,000 — meaning रू 66,000 less income to tax.
How TDS (Tax Deducted at Source) works
TDS is not a separate tax — it is the mechanism by which your employer deducts estimated annual income tax from each monthly salary payment. Your employer:
- Estimates your total annual income
- Calculates the annual tax liability
- Divides by 12 and deducts that amount monthly
- Deposits it directly to IRD on your behalf
At the end of the fiscal year (Ashadh 31 / mid-July), you file your annual return. If TDS deducted was more than actual tax, you get a refund. If less, you pay the difference.
Worked example — monthly salary of रू 80,000
Assumptions: unmarried, basic 60% of gross, joined SSF.
| Item | Monthly | Annual |
|---|---|---|
| Gross salary | रू 80,000 | रू 9,60,000 |
| SSF deduction (11% of basic रू 48,000) | रू 5,280 | रू 63,360 |
| Standard deduction | — | रू 50,000 |
| Taxable income | — | रू 8,46,640 |
| Tax on first रू 5,00,000 @ 1% | — | रू 5,000 |
| Tax on next रू 2,00,000 @ 10% | — | रू 20,000 |
| Tax on remaining रू 1,46,640 @ 20% | — | रू 29,328 |
| Total annual tax | — | रू 54,328 |
| Monthly TDS | रू 4,527 | — |
| Net take-home | रू 70,193 | — |
Use the Salary Calculator to run this instantly for your own salary without doing the math manually.
Allowable deductions that reduce your taxable income
These deductions are subtracted from gross income before tax is applied:
| Deduction | Limit |
|---|---|
| SSF contribution (employee portion) | Actual amount (11% of basic) |
| CIT (Citizen Investment Trust) | Up to रू 3,00,000/year |
| Life insurance premium | Up to रू 40,000/year |
| Medical insurance | Up to रू 20,000/year |
| Standard deduction | रू 50,000 (salaried) |
| Elderly parent medical (above 70 yrs) | Up to रू 50,000/year |
| Remote area allowance | Varies by zone |
Filing all eligible deductions can save a रू 10 lakh earner उपस रू 30,000–50,000 in annual tax.
Government employee salary and tax FY 2082/83
Government employees have a different pay structure. For reference:
| Level | Basic salary (approx.) | Gross with allowances (approx.) |
|---|---|---|
| Chief Secretary | रू 77,000+ | रू 1,10,000+ |
| Joint Secretary | रू 56,000+ | रू 80,000+ |
| Section Officer (Gazetted 3rd) | रू 38,000+ | रू 55,000+ |
| Non-Gazetted 1st Class | रू 28,000+ | रू 42,000+ |
Government employees also contribute to CIT (Citizen Investment Trust) instead of SSF, and the employer (government) contributes a matching amount.