What is TDS (Tax Deducted at Source)?
स्रोतमा कर कट्टी
TDS is Tax Deducted at Source — income tax withheld by the payer at the moment of payment and deposited with the IRD. In Nepal, TDS applies to salaries, rent, interest, dividends, service fees and contracts, at rates that vary by payment type (e.g. 15% on many service fees, 10% on rent to a person).
TDS spreads tax collection across the year and improves compliance. The deducted amount is credited against the recipient's final tax liability.
Rates depend on the nature of the payment and are set by the Income Tax Act 2058 and each year's Finance Act.
Sources & data note
Definitions explain standard Nepali terms in everyday and official use. Land-unit conversions follow the standard Nepali measurement system; tax and contribution rates reflect current law (Income Tax Act 2058, VAT Act 2052, Social Security Act 2074) and are revised each fiscal year by the Finance Act — always confirm current-year figures with the relevant authority.