Salary Tax Slabs in Nepal for FY 2083/84 (2026/27), With Worked Examples

The new FY 2083/84 salary tax slabs in Nepal: 1% up to Rs 10 lakh, then 10%, 20%, 27% and 29%. One table for everyone, SSF exemption, and monthly TDS examples.

This guide is for employers and employees in Nepal. It covers the salary tax rules for fiscal year 2083/84 (Shrawan 1, 2083 to Asar end, 2084, roughly 17 July 2026 to mid-July 2027) under the Finance Act 2083.

The 2083/84 budget made the biggest change to salary tax in years. If your payroll still uses last year's table, you are deducting the wrong TDS from almost every employee.

What changed this year

The FY 2083/84 slabs

Taxable income for the year, for a resident individual:

Some summaries describe the top band as 27% plus a 2% surcharge. Either way, income above Rs 40 lakh pays 29% in total.

SSF contributors don't pay the 1%. The first band is the social security tax. If an employee contributes to the Social Security Fund, that 1% is waived.

How taxable income is worked out

1. Start with the year's salary: basic pay, allowances, Dashain allowance (festival allowance), overtime and bonuses.
2. Add the employer's retirement contributions, such as the employer's 20% SSF share or employer PF. These count as the employee's income first and are then deducted in step 3.
3. Deduct retirement contributions (SSF, CIT, PF) up to the lower of Rs 5,00,000 or one-third of income.
4. Deduct allowed insurance premiums. Commonly cited limits are life insurance up to Rs 40,000 and health insurance up to Rs 20,000, or the actual premium if lower.
5. Apply the slabs above to what remains.
6. Apply rebates. For example, women whose only income is from employment have commonly received a 10% rebate on their tax.

Worked examples (FY 2083/84)

These examples are simplified: there's no insurance, no remote-area allowance, and pay is the same every month.

Example 1: Rs 50,000 a month, no SSF

• Annual income: Rs 6,00,000, all within the 1% band
• Tax: Rs 6,000 a year, or Rs 500 a month

Example 2: Rs 1,00,000 a month, no SSF

• Annual income: Rs 12,00,000
• First Rs 10,00,000 × 1% = Rs 10,000
• Next Rs 2,00,000 × 10% = Rs 20,000
• Tax: Rs 30,000 a year, or Rs 2,500 a month

Example 3: Rs 1,00,000 a month, basic Rs 60,000, enrolled in SSF

• Salary for the year: Rs 12,00,000
• Plus the employer's 20% SSF share: Rs 12,000 × 12 = Rs 1,44,000. Assessable income is Rs 13,44,000.
• Less total SSF contributions of 31% of basic: Rs 18,600 × 12 = Rs 2,23,200. This is under both Rs 5 lakh and one-third of income.
• Taxable income: Rs 11,20,800
• First Rs 10 lakh: 1% waived because of SSF, so Rs 0
• Next Rs 1,20,800 × 10% = Rs 12,080
• Tax: Rs 12,080 a year, about Rs 1,007 a month

Example 4: Rs 2,00,000 a month, no SSF

• Annual income: Rs 24,00,000
• First Rs 10,00,000 × 1% = Rs 10,000
• Next Rs 5,00,000 × 10% = Rs 50,000
• Next Rs 9,00,000 × 20% = Rs 1,80,000
• Tax: Rs 2,40,000 a year, or Rs 20,000 a month

Getting monthly TDS right

Employers deduct TDS every month based on the expected income for the whole year, not on that month's pay alone. That gets tricky when:

• Someone gets a raise mid-year. The remaining months must make up the difference.
• A Dashain allowance or bonus is paid in one month. It pushes up the year's total.
• Someone joins in Poush. They have fewer months left to spread the tax over.

The safe approach is to recalculate every month: estimate the year's tax, subtract what you've already deducted, and spread the remainder over the months left until Asar. TeamKro's payroll recalculates TDS for each person this way every month, so the year settles correctly by Asar.

Try it with your own numbers

Use the free Nepal Salary Tax Calculator (FY 2083/84). Enter a monthly salary, choose SSF or no SSF, and see the yearly and monthly tax band by band.

FAQ

Is there still a separate tax table for married people?
No. From FY 2083/84 there is one table for everyone.

If I earn under Rs 10 lakh a year, do I pay nothing?
You pay 1% social security tax, unless you contribute to SSF; then it's waived.

When do the new slabs apply?
From Shrawan 1, 2083 (about 17 July 2026). Payroll for Shrawan 2083 onwards should use them.

Does Dashain allowance get taxed?
Yes. It counts as employment income. See How Dashain allowance is taxed in Nepal.

Last checked 31 October 2026 against the Finance Act 2083 as reported by the Inland Revenue Department and Nepali news coverage. Tax law changes every budget; confirm with IRD or your accountant before filing. This is general information, not tax advice.

Sources: ShareSansar: Budget 2083/84 tax threshold · The Himalayan Times: Govt raises exemption threshold · Inland Revenue Department