How to use the Nepal salary tax calculator
The calculator above works the same way a payroll team does it. You enter what you earn and what you contribute, and it applies the income tax slabs for the fiscal year you select.
- Pick the fiscal year. Nepal’s slabs change with each Finance Act, so an old year gives a different answer than the current one.
- Choose married or unmarried. Couples who file jointly get a wider first slab, which lowers tax on the same income.
- Enter monthly salary, months worked, and bonus. If you joined mid-year, reduce the number of months instead of averaging your salary down.
- Add your contributions. Social Security Fund, Provident Fund, Citizen Investment Trust, life insurance, and medical insurance premiums reduce taxable income within limits.
- Read both numbers. Annual tax is what you owe for the year; monthly TDS is what should come out of each payslip.
What counts as salary income
Assessable employment income is wider than basic pay. It normally includes your basic salary, allowances such as Dashain or festival expense, grade increments, overtime, commissions, bonuses, and cash benefits paid by the employer. Reimbursement of genuine business expenses is treated differently from an allowance, so keep the two separate when you enter figures.
If part of your package is non-cash — a vehicle, accommodation, or subsidised loan — the taxable value of those benefits is set by rules the calculator does not attempt to guess. Ask your payroll team for the valued amount and add it to your annual figure.
Deductions that actually reduce your tax
Three groups of contributions do most of the work for salaried people in Nepal:
- Retirement contributions — your share of SSF, EPF, or CIT, subject to a cap and a proportional limit on assessable income.
- Life insurance premium — deductible up to an annual ceiling.
- Health insurance premium — deductible up to a smaller annual ceiling, where the fiscal year allows it.
The current limits are listed on the Nepal tax slabs page. Enter the amount you actually paid — the calculator applies the cap for you rather than silently accepting an over-claim.
Salary tax and TDS are the same calculation.
People search for a “TDS calculator” and a “salary tax calculator” as if they were different tools. For an employee, they are not. Your employer estimates your annual tax liability, divides it across the year, and deducts that amount monthly as tax deducted at source. That is why this page shows annual tax and monthly TDS side by side instead of splitting them into two pages.
Your payslip deduction can still differ from the monthly figure here. Employers often recalculate after a mid-year raise, a bonus, or once you submit insurance receipts, then adjust the remaining months so the year still lands on the correct total.
Why your result may differ from your payslip
- Your employer values non-cash benefits that you have not entered here.
- You have income outside employment — rent, interest, consulting — which is assessed separately.
- You changed jobs and both employers withheld against their own estimate.
- Insurance or retirement receipts were submitted late in the year.
- You qualify for a relief the calculator does not model, such as a remote-area allowance or a disability adjustment.
Treat the output as a planning estimate. When the number matters — a loan application, a resignation settlement, a return you are about to file — confirm it with your employer or a licensed tax practitioner.
Frequently asked questions
Is this calculator free?
Yes. Every calculator on this site is free, needs no sign-up, and runs in your browser. Nothing you type is sent to a server.
Does it work for a mid-year joiner?
Yes. Set the number of months to the months you were actually employed in that fiscal year and leave your monthly salary at its real value.
Can I download the calculation?
Yes. Use Download PDF in the results panel. The report includes your inputs, every deduction applied, the slab-by-slab breakdown, and the final annual and monthly figures.
Are the slab rates current?
The rates are maintained in the site’s settings and reviewed when a new Finance Act is published. The exact values in use are always visible on the tax slabs page, so you can check them yourself rather than take our word for it.
Who should I trust for the final number?
The Inland Revenue Department and a licensed tax professional. This site helps you plan and double-check; it does not file anything on your behalf.
About the figures on this site
Rates come from Nepal’s Finance Act and Inland Revenue Department publications. When rates change, we update the calculator’s settings and note it here. If you spot something that looks wrong, please tell us on the contact page — corrections are welcome, and we act on them.
Reference: Inland Revenue Department, Government of Nepal. Read our disclaimer before relying on any figure.