What are the deadlines for Section 94 Advance Tax Instalments (अग्रिम कर किस्ताबन्दी)?

Under Section 94 of the Income Tax Act 2058, every company and business entity must deposit advance income tax in three installments: 1st Instalment (40% cumulative) by the end of Poush (mid-January); 2nd Instalment (70% cumulative) by the end of Chaitra (mid-April); and 3rd Instalment (100% cumulative) by the end of Ashadh (mid-July).

What happens if a company fails to pay the 80% advance tax threshold?

Under Section 118 of the Income Tax Act, if the advance tax paid by an installment deadline is less than 80% of the actual tax that would have been due, the Inland Revenue Department (IRD) charges interest at the rate of 15% per annum on the underpaid portion from the due date until the tax is settled.

Can TDS deducted by clients be adjusted against corporate income tax?

Yes! All withholding tax (TDS) deducted by clients and customers on invoices paid to your company during the fiscal year serves as advance tax credit. It is deducted directly from your gross annual corporate income tax liability when preparing your D-03 tax return on the IRD portal.

Nepal Corporate Tax & Section 94Advance Tax Instalments (किस्ताबन्दी)

Nepal Corporate Tax & Advance Tax Calculator

Estimate corporate income tax for Pvt Ltd and firms with Section 94 advance tax instalments (Poush 40%, Chaitra 70%, Ashadh 100%).

Corporate Rate:25%

Business Sector & Industry Type (व्यवसायको प्रकृति)

Private and public limited companies engaged in retail, wholesale, IT domestic, consulting, and trading.

Net Accounting Profit Before Tax (कर अघिको खुद नाफा)

रु

Quick:

Income Tax Adjustments (कर समायोजनहरू)

Add: Disallowable / Inadmissible Expenses (अस्वीकृत खर्च)Fines, penalties, personal expenses, unapproved donations, excess entertainment

Less: Allowable Deductions / Tax Depreciation (स्वीकृत छुट)Schedule 2 tax depreciation difference, allowable scientific research

Less: Advance TDS Withheld by Clients (कट्टी भइसकेको TDS)

रु

Withholding tax already deposited by clients under PAN / e-TDS

Net Annual Tax Payable to IRD (तिर्नुपर्ने खुद आयकर)

रु 8,17,500

Taxable Income: Rs. 35,70,000 (25%)

GROSS ANNUAL TAX

रु 8,92,500

25% Statutory Rate

TDS CREDIT ADJUSTED

रु 75,000

Advance Tax Credit

Section 94 Advance Tax Schedule (किस्ताबन्दी तालिका)

3 Instalments

1st Instalment: Poush End (पुस मसान्त)(Mid-January)

Cumulative 40% of estimated annual tax

रु 3,27,000

40% Due

2nd Instalment: Chaitra End (चैत मसान्त)(Mid-April)

Additional 30% (Cumulative 70%)

रु 2,45,250

30% Due

3rd Instalment: Ashadh End (असार मसान्त)(Mid-July)

Final 30% (Reaching 100% of tax liability)

रु 2,45,250

30% Due

Section 118 80% Threshold Rule:
If the advance tax paid by the deadline is less than 80% of the actual final assessed tax, interest at 15% p.a. is levied on the underpaid portion.

Quick Summary

Inland Revenue Department (IRD) Nepal

What are the standard corporate tax rates in Nepal for FY 2083/84?

General trading, consulting, and service companies are taxed at 25%. Special manufacturing industries designated under Section 11 pay a concessional rate of 20%. Banks, financial institutions (BFIs), general insurance companies, and tobacco/liquor manufacturers pay 30%. Information technology (IT) and software export services enjoy a 50% rebate, resulting in an effective rate of 12.5%.

FY 2083/84 Active Slabs1% SSF Waiver ApplicableIRD Nepal Standard

Nepal Corporate Tax & Advance Tax Calculator

What are the standard corporate tax rates in Nepal for FY 2083/84?

Nepal Corporate & Advance Tax FAQs

Nepal Corporate Tax & Advance Tax Calculator

What are the standard corporate tax rates in Nepal for FY 2083/84?

Nepal Corporate & Advance Tax FAQs