Quick Test Presets (Common Nepal Enterprise Profiles):
Corporate Tax Regime Selector
Choose between Audited Financial Return (D-03) and Small Business Presumptive Taxation (D-01 / D-02).
:
2. Statutory Rebates & Concessions (Section 11)
workers
0
100 (10%)
300 (20%)
500 (25%)
1,000+ (30%)
Section 88 / 89 TDS deductions by clients to offset final payable.
Small Business Presumptive Scheme (Section 4(4)):
For sole proprietors and individual traders without double-entry audited accounting books. Applicable only up to Rs. 1 Crore annual turnover.
✓ Eligible for D-01 Form (Turnover ≤ Rs. 30 Lakhs) — Fixed Flat Tax.
✓ Eligible for D-02 Form (Rs. 30 Lakhs to Rs. 1 Crore) — Percentage of Turnover.
⚠️ Turnover exceeds Rs 1 Crore. Presumptive filing disallowed under Section 4(4). Must file audited D-03!
Estimated Tax Liability
FY 2083/84
Net Tax Payable to IRD:
रु
Statutory Base Rate:
Gross Tax on Net Profit:
रु
Section 11 Rebates (Employment & Area):
- रु
Tax Credits / Advance TDS:
- रु
Effective Tax Rate:
Net Profit After Tax (PAT):
रु
Filing Schedule:
Calculation Basis:
Section 114 Advance Tax Schedule
Poush / Chaitra / Ashadh
1st Installment (40% Cumulative)
Due: End of Poush (mid-January)
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2nd Installment (70% Cumulative)
Due: End of Chaitra (mid-April)
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3rd Installment (100% Final)
Due: End of Ashadh (mid-July)
रु
Failure to deposit estimated installments triggers daily compound interest at 15% per annum under Section 119.
Nepal Finance Act Matrix
Corporate Income Tax (CIT) Slabs & Concessions
Official tax rate breakdown under Schedule 1 and Section 11 of the Nepal Income Tax Act 2058.
| Entity Type / Industry Sector | Standard Base Rate | Special Concessions / Rebates (Section 11) | Legal Authority |
|---|---|---|---|
| Normal Trading & Commercial Companies | 25% | General retail, wholesale, distributors, consulting services. | Schedule 1 Sec 2(1) |
| Manufacturing & Production Industries | 20% | 20% effective tax rate + up to 30% employment rebate for 1,000+ Nepali workers. | Section 11(2) |
| IT, Software Development & BPO Export | 15% | 50% concession on standard rate for foreign currency export revenues. | Section 11(3x) |
| Special / Agro-based 100% Export Industries | 20% | Herbal processing, agro-processing, tea/coffee processing units. | Section 11(3) |
| Banks, Financial Institutions & Insurance | 30% | Commercial banks, development banks, finance companies, general/life insurers. | Schedule 1 Sec 2(2) |
| Cigarette, Tobacco, Liquor & Petroleum | 30% | Spirits, breweries, tobacco manufacturers, oil refinery/distribution. | Schedule 1 Sec 2(2) |
Statutory Section 21 Disallowed Expense Checklist:
•
Cash Payments > Rs. 50,000: Disallowed in tax profit computation; must be paid via banking transfer or cheque.
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Invoices without PAN > Rs. 1,000: Unrecorded supplier bills cannot be booked as business expenses.
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Fines, Penalties & Delay Fines: Legal penalties paid to IRD or customs cannot be deducted from gross profits.
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Personal Expenses: Personal travel, household groceries, and director personal utility bills are disallowed.
Knowledge Base
Frequently Asked Questions on Nepal Corporate Tax
Under Schedule 1 of the Nepal Income Tax Act 2058 (आयकर ऐन २०५८), the standard corporate tax rate is 25% for general trading, retail, consulting, and commercial companies. Special concessions apply: registered manufacturing industries pay an effective 20% rate, IT/software export firms pay 15%, while banks, financial institutions, and alcohol/tobacco manufacturers are taxed at 30%.
Under Section 11 of the Income Tax Act, manufacturing entities (उत्पादनमूलक उद्योग) receive special exemptions. First, their base rate is reduced from 25% to 20%. Furthermore, if the industry directly employs Nepali citizens throughout the fiscal year, additional tax rebates apply: 10% rebate for 100+ employees, 20% rebate for 300+ employees, 25% rebate for 500+ employees, and 30% rebate for 1,000+ employees.
Small individual proprietors can file simplified presumptive returns under Section 4(4). D-01 filers (annual turnover up to Rs. 30 Lakhs and net profit up to Rs. 3 Lakhs) pay a fixed flat fee: Rs. 7,500 in Metros, Rs. 4,000 in Municipalities, and Rs. 2,500 in Rural Municipalities. D-02 filers (turnover between Rs. 30 Lakhs and Rs. 1 Crore) pay a turnover percentage: 0.25% for fixed-commission goods, 0.75% for general trading goods, or 2.0% for service/consultancy businesses without needing audited accounts.
Under Section 114 of the Nepal Income Tax Act 2058, every company whose estimated annual tax liability exceeds Rs. 7,500 must remit advance tax in three statutory installments: 40% of estimated annual tax by Poush End (mid-January), 70% by Chaitra End (mid-April), and the full 100% by Ashadh End (mid-July). Delayed payment incurs 15% per annum daily compound interest under Section 119.
Under Section 21 of the Income Tax Act 2058, expenses disallowed during tax audits include: cash payments exceeding Rs. 50,000 for single transactions (must be via banking channels), personal household expenses of directors, fines and penalties paid to government bodies, VAT amounts claimed as input tax credit, and any payment exceeding Rs. 1,000 made to suppliers without a valid PAN bill.
ByaparOS automatically tracks all sales, purchases, payroll, SSF contributions, asset depreciation schedules (Block A to E under Schedule 2), and allowable business expenses in real-time. At fiscal year-end, ByaparOS produces one-click balance sheets, profit & loss statements, and trial balances directly formatted for your external auditor and IRD D-03 filing.
Audit-Ready Accounting ERP
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