TDS (Tax Deducted at Source) Guide
Complete guide to TDS compliance in Nepal - Rates, filing, and certificates
What is TDS?
Tax Deducted at Source (TDS) is advance tax collected at the time of payment. The payer deducts a specified percentage and deposits it with IRD on behalf of the payee.
Common TDS Rates in Nepal
- Salary: Progressive rates (1% to 36%)
- Interest on deposits: 5%
- Dividend: 5%
- Rent: 10%
- Professional fees: 15%
- Contract payments: 1.5%
- Commission: 15%
TDS Deposit Timeline
TDS must be deposited within 25 days of the month in which payment was made. For example, TDS deducted in January must be deposited by February 25.
TDS Return Filing
Quarterly TDS returns must be filed within 25 days of quarter-end. Annual TDS statements must be filed with income tax returns.
TDS Certificates
Employers/payers must issue TDS certificates to employees/payees showing tax deducted. This certificate can be used to claim credit while filing income tax returns.
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⚠️ Disclaimer
This guide provides general information about Nepal's tax and business regulations. Requirements may change over time. Please verify with the Inland Revenue Department (IRD) or consult a qualified professional for specific advice related to your situation.