Nepal Income Tax Calculator

How Income Tax is calculated in Nepal?

Let’s break this down in a way that actually makes sense. If you’ve ever looked at your paycheck or yearly income and wondered, “How much of this goes to taxes?”—you’re not alone. The good news? It’s not as complicated as it seems once you understand the basics.

Taxable vs. Non-Taxable Income

Not all of your income is taxed. That’s right—some parts are exempt.

Taxable income is the portion that gets taxed by the government. It includes things like:

• Your basic salary or business income
• Allowances (if not tax-exempt)
• Bonuses
• Rental income or any additional earnings

On the other hand, non-taxable income includes:

• Festival allowances (within limits)
• Dashain bonus (up to one month’s basic salary)
• Provident Fund and SSF contributions (as per government rules)
• Certain insurance and retirement savings

So before you calculate your tax, it’s important to filter out what’s not taxable first.

What Deductions Can You Claim?

You’re allowed to reduce your taxable income by claiming deductions, which means you’ll end up paying less tax. Here are some common ones you should know about:

• Social Security Fund (SSF): If you’re contributing to SSF, that amount is deducted before calculating your tax.
• Citizen Investment Trust (CIT): Up to a government-specified limit (usually NPR 300,000/year).
• Insurance Premiums: Life insurance premiums are deductible up to NPR 40,000 per year.
• Medical Expenses for Elderly Parents: Sometimes claimable depending on the situation.

Claiming these correctly can make a big difference in how much tax you actually pay.

Tax Slabs for Individuals and Couples

Nepal uses different tax slabs for:

• Individuals (unmarried)
• Married couples
• Senior citizens
• Non-resident Nepalis

Here’s a simplified view for individuals (for FY 2082/83):

• Up to NPR 500,000 – 1%
• NPR 500,001 – 700,000 – 10%
• NPR 700,001 – 1,000,000 – 20%
• NPR 1,000,001 – 2,000,000 – 30%
• NPR 2,000,000 – 5,000,000 – 36%
• NPR 5,000,001 to ∞ – 39%

For married couples, the tax-free threshold is a bit higher, usually around NPR 600,000.

The more you earn, the higher the rate that applies—but only on the income above each threshold.

Progressive Tax Rate – What it means for you?

Nepal follows a progressive tax system. That means you’re not taxed at the same rate on all of your income.

Let’s say you earn NPR 900,000 a year and you’re single:

• The first 500,000 is taxed at 1%
• The next 200,000 (from 500,001 to 700,000) is taxed at 10%
• The last 200,000 (from 700,001 to 900,000) is taxed at 20%

You don’t pay 20% on the full 900,000. Just on the part that falls into that bracket. It’s kind of like climbing stairs—each step (or slab) has its own tax rate.

So when you use this calculator, it does all this behind the scenes for you. It looks at your gross income, removes the deductions, applies the correct slabs, and shows you exactly how much you owe. Simple, right?

You don’t need to be an accountant to understand your taxes. Just the right tool—and you’ve found it.

Nepal Tax Slabs – Latest Rates for Individuals, Couples & NRNs (FY 2082/83)

Here are the updated income tax slabs applicable for the current fiscal year 2082/83 (2025/26). Whether you’re a salaried employee, a married couple filing jointly, a senior citizen, or a non-resident Nepali (NRN), your tax rate will differ slightly. Let’s make it easy to understand.

For Unmarried Individuals

Income Range (NPR)	Tax Rate (Individual)	Tax Rate (Couple)
Up to 500,000 (600,000 for couples)	1% (Social Security Tax)	1% (Social Security Tax)
Next 200,000	10%	10%
Next 300,000	20%	20%
Next 1,000,000 (900,000 for couples)	30%	30%
Next 3,000,000	36%*	36%*
Above 5,000,000	39%**	39%**

Notes

• 1% on the first slab is not an income tax, but a Social Security Tax (SST). It is waived if you contribute to the Social Security Fund (SSF).
• * 36% includes an additional 20% tax on income between NPR 2,000,000 – NPR 5,000,000.
• ** 39% includes an additional 30% tax on income exceeding NPR 5,000,000.

Need help calculating how this applies to your salary? Scroll up and use the free Nepal Income Tax Calculator for FY 2082/83!