ETDS Filing Service

TDS stands for Tax deducted at source which is also known as withholding Tax. Four Ace Business Solutions help you through the TDS filing process, helping you understand its purpose, calculation methods, deadlines, and more.  TDS rates in Nepal may vary depending on the type of income and the status of the taxpayer.

 

What are the Deadlines for TDS Filing?

Monthly TDS Returns: Within 25th  day from the end of each month

TDS Payment: To be deposited within 25th day from the end of each month

Annual TDS Returns: Must be filed by the end of the fiscal year (mid-July)

 

 

Calculation of TDS for Different Income Types

1. Salary Income: TDS on salary is calculated based on the employee’s annual income (including allowance and benefits) and applicable Nepal government Tax slabs. 

2. Interest Income: Banks and financial institutions deduct TDS on interest earnings at a flat rate of 5% for resident individuals.

3. Dividend Income: TDS on dividends is deducted at a rate of 5% for both resident and non-resident individuals.

4. Rent Income: TDS on rent payments is calculated at 10% of the gross rent amount for both residential and commercial properties.

5. Contract Payments: For payments made to contractors, TDS is deducted at 1.5% of the gross payment amount.

6. Professional Services: TDS on fees for professional services is calculated at 15% of the gross payment if service provider registered in PAN. TDS on fees  for professional services is calculated at 1.5% of the gross payment if service provider registered in VAT.

 

 

TDS Exempted Payments in Nepal

1. Interest payment to banks and financial institutions. 

2. Payment of Government Tax and Fees.

3. House rent payment to a natural person.

4. Dividend or interest payment to a Mutual Fund

5. Payment of insurance amount by the insurance company on the death of an insured person.

6. Payment made by a natural person for his personal expense (not relating to his business).