Income Tax Slabs Nepal and Rates for Individuals
Current and historical income tax slabs for individuals in Nepal, with deduction limits, the SSF waiver, and the female rebate explained.
Nepal taxes individual income progressively: each slice of your taxable income is taxed at its own rate, not the whole amount at your top rate. The tables below show the rates this site’s calculator currently applies, followed by an explanation of how they work in practice.
Current income tax slabs
| Taxable income | Tax rate |
|---|---|
| Up to Rs. 1,000,000 | 1% (social security tax — waived for SSF contributors) |
| Rs. 1,000,001 – Rs. 1,500,000 | 10% |
| Rs. 1,500,001 – Rs. 2,500,000 | 20% |
| Rs. 2,500,001 – Rs. 4,000,000 | 27% |
| Above Rs. 4,000,000 | 29% |
Rates shown are the values configured for this calculator. Always confirm against the current Finance Act or an IRD notice before filing.
How progressive slabs actually work
Crossing into a higher slab does not re-tax your earlier income. Suppose the first slab ends at a certain amount and the next one is taxed at 10%. If you earn one rupee more than that first threshold, only that single rupee is taxed at 10% — everything below it stays at the lower rate.
This is why a raise never leaves you worse off, and why your effective rate is always lower than your top slab rate. The calculator shows both: the slab-by-slab breakdown, and the single effective percentage of your total income that actually goes to tax.
Married and unmarried filing
Nepal recognises a couple filing jointly as a separate category with a wider first slab than an individual filing alone. For a single-earner household, this usually reduces tax on the same income. Where a fiscal year applies one uniform schedule to both categories, the tables above will show a single combined table instead of two.
The 1% social security tax and the SSF waiver
The lowest band carries a 1% charge that functions as a social security tax rather than ordinary income tax. Contributors to the Social Security Fund are not charged this 1% on the first slab. That is why ticking SSF contributor in the calculator lowers your total: the first band’s charge is waived, and the remaining slabs are unaffected.
Female rebate
A resident woman filing as an unmarried individual receives a rebate on the assessed tax. The rebate applies to the tax figure, not to income, and it does not apply where the return is filed under the married category. The calculator applies it automatically when both conditions are met and shows the amount as a separate line in the breakdown.
Deductions and rebates that change the outcome
| Item | Maximum claimable |
|---|---|
| Retirement contributions (SSF + EPF + CIT) | Lower of Rs. 500,000 or one-third of assessable income |
| Life insurance premium | Rs. 40,000 |
| Health / medical insurance premium | Rs. 20,000 |
| Female rebate (filing as unmarried) | 10% of assessed tax |
Retirement contributions are limited both by an absolute ceiling and by a proportion of assessable income, so a very high contribution on a modest salary is capped at the lower of the two. Insurance premiums are capped at flat annual amounts. Enter what you paid and let the calculator apply the limit — that way you see the same figure your employer will use.
Earlier fiscal years
Old slabs matter when you are reconstructing a past return, checking an old settlement, or comparing offers across years. The calculator keeps earlier fiscal years selectable, and the full history it uses is shown below.
| Taxable income | Tax rate |
|---|---|
| Up to Rs. 1,000,000 | 1% (social security tax — waived for SSF contributors) |
| Rs. 1,000,001 – Rs. 1,500,000 | 10% |
| Rs. 1,500,001 – Rs. 2,500,000 | 20% |
| Rs. 2,500,001 – Rs. 4,000,000 | 27% |
| Above Rs. 4,000,000 | 29% |
| Taxable income | Tax rate |
|---|---|
| Up to Rs. 500,000 | 1% (social security tax — waived for SSF contributors) |
| Rs. 500,001 – Rs. 700,000 | 10% |
| Rs. 700,001 – Rs. 1,000,000 | 20% |
| Rs. 1,000,001 – Rs. 2,000,000 | 30% |
| Rs. 2,000,001 – Rs. 5,000,000 | 36% |
| Above Rs. 5,000,000 | 39% |
| Taxable income | Tax rate |
|---|---|
| Up to Rs. 500,000 | 1% (social security tax — waived for SSF contributors) |
| Rs. 500,001 – Rs. 700,000 | 10% |
| Rs. 700,001 – Rs. 1,000,000 | 20% |
| Rs. 1,000,001 – Rs. 2,000,000 | 30% |
| Rs. 2,000,001 – Rs. 5,000,000 | 36% |
| Above Rs. 5,000,000 | 39% |
| Taxable income | Tax rate |
|---|---|
| Up to Rs. 500,000 | 1% (social security tax — waived for SSF contributors) |
| Rs. 500,001 – Rs. 700,000 | 10% |
| Rs. 700,001 – Rs. 1,000,000 | 20% |
| Rs. 1,000,001 – Rs. 2,000,000 | 30% |
| Rs. 2,000,001 – Rs. 5,000,000 | 36% |
| Above Rs. 5,000,000 | 39% |
| Taxable income | Tax rate |
|---|---|
| Up to Rs. 500,000 | 1% (social security tax — waived for SSF contributors) |
| Rs. 500,001 – Rs. 700,000 | 10% |
| Rs. 700,001 – Rs. 1,000,000 | 20% |
| Rs. 1,000,001 – Rs. 2,000,000 | 30% |
| Above Rs. 2,000,000 | 36% |
| Taxable income | Tax rate |
|---|---|
| Up to Rs. 400,000 | 1% (social security tax — waived for SSF contributors) |
| Rs. 400,001 – Rs. 500,000 | 10% |
| Rs. 500,001 – Rs. 700,000 | 20% |
| Rs. 700,001 – Rs. 2,000,000 | 30% |
| Above Rs. 2,000,000 | 36% |
Rates shown are the values configured for this calculator. Always confirm against the current Finance Act or an IRD notice before filing.
Frequently asked questions
Which slab applies to my whole salary?
None of them, individually. Your income is split across bands, and each band is taxed at its own rate. Use the salary tax calculator to see your income divided up slab by slab.
Are these slabs for individuals or companies?
Individuals. Company income tax is charged at flat corporate rates that depend on the sector, and is outside the scope of these tables.
Do the slabs apply to rent or interest income?
Not always. Certain income types are taxed at fixed rates or through final withholding rather than being added to your salary and run through the slabs. If you have significant non-salary income, get advice specific to your situation.
When do slabs change?
With the annual Finance Act, which normally takes effect from the start of the fiscal year in mid-July. We review these tables when a new act is published.
Sources
Slab and deduction values follow Nepal’s Finance Act and Inland Revenue Department publications, and are stored in this site’s settings so the tables above always match what the calculator uses—official reference: Inland Revenue Department. See our disclaimer before relying on these figures.