Understanding income tax rates is important for both businesses and individuals. Whether you are starting a company or managing your personal finances, knowing the latest tax rules helps you plan better and stay compliant.
In this guide, we explain corporate and individual income tax rates for 2025 in simple terms.
Corporate Income Tax Rates in Nepal 2025
Companies in Nepal pay income tax based on their type. Here are the updated tax rates for 2025:
| Type of Company | Tax Rate |
|---|---|
| Public Limited Companies | 25% |
| Private Limited Companies | 25% |
| Banks and Financial Institutions | 30% |
| Insurance Companies | 30% |
| Hydroelectricity Companies | 10% |
| Manufacturing Companies | 20% |
Note: Some industries, like hydropower, enjoy lower tax rates as a government incentive.
Individual Income Tax Rates in Nepal 2025
Individual income tax in Nepal is progressive, meaning higher income is taxed at higher rates. Here is the slab for 2025:
| Annual Income (NPR) | Tax Rate |
|---|---|
| Up to 500,000 | 1% |
| 500,001 to 700,000 | 10% |
| 700,001 to 2,000,000 | 20% |
| Above 2,000,000 | 30% |
Additional points:
- Senior citizens (60+) may have special slabs or benefits.
- Taxpayers can claim deductions under different sections to reduce taxable income.
Why Tax Knowledge Matters
Understanding tax rates helps you plan your finances, maximize profits, and stay legal. If you are registering a company or need help with updates, share transfers, or closure, knowing your tax obligations is essential.
Reference & Further Reading
- Income Tax Act, 2058 (2002), Nepal – The main law on income tax.
- What Are the Types of Taxable Income in Nepal? – Overview of taxable income categories.
- Video: Understanding Taxable Income in Nepal – A visual guide for beginners and professionals.