Taxation In NepalTU Board 2082
William is foreign citizenship holder arrived in Nepal on 1st Falgun, and stayed in Nepal at the end of Ashadh of previous income year. He earned in Nepal Rs. 500,000 as consultancy fee. Required:…
2William is foreign citizenship holder arrived in Nepal on 1st Falgun, and stayed in Nepal at the end of Ashadh of previous income year. He earned in Nepal Rs. 500,000 as consultancy fee. Required: Residential status and tax liability of William.
Answer
William’s residential status and tax liability are determined as follows:
Residential Status
William is a non-resident under Section 2(10) of the Income Tax Act, 2058, because:
- He is a foreign citizen.
- He stayed in Nepal for less than 182 days (from Falgun 1 to Ashadh end of the previous income year).
Tax Liability
Since William is a non-resident, only his Nepal-sourced income is taxable. His consultancy fee of Rs. 500,000 is taxed at the flat rate of 25% (as per Section 115(1)(a)).
Calculation:
| Income | Tax Rate | Tax Amount |
|---|---|---|
| Rs. 500,000 | 25% | Rs. 125,000 |
Final tax liability: Rs. 125,000 (no deductions apply for non-residents).
Discussion
Loading…
More Taxation In Nepal questions
Define direct tax with example.TU Board 20822What do you mean by “Non chargeable business assets”?TU Board 20822Explain the meaning of “Canon of Certainty”?TU Board 20822What do you mean by Permanent Account Number (PAN)?TU Board 20822Briefly describe the provision related to quantification of accommodation facilities provided to an employee.TU Board 20822Bikram, a resident of Nepal furnished the following particulars of his income for the previous year. a. Assessable income from garment business Rs. 500,000 b.…TU Board 20822