Computation of Tax

Question 1

Income Slabs for Goods & Service Sales (Sec 1(17))

Answer 1

Goods Sale (Margin ≤ 3%)
First 30 Lakhs: As per Sec 1(7)
Next 20 Lakhs: 0.25%
Balance: 0.3%

Other Cases (Margin > 3%)
First 30 Lakhs: Rs. 7500/4000/2500
Next 20 Lakhs: 1%
Balance: 0.8%

Service Sale:
First 30 Lakhs: As per Sec 1(7)
2% on all balance

Question 2

Tax Liability as per Sec 1(7) of Schedule 1

Answer 2

Metro/Sub Metro Rs. 7500
Municipality: Rs. 4000
Rural Municipality: Rs. 2500

Question 3

Sec 4(4a) criteria

Answer 3

Resident natural persons with business income in Nepal

Conditions:
Turnover Rs. 30 Lakhs to Rs. 1 Crore
Profit ≤ Rs. 10 Lakhs
Cannot claim
-Medical tax credit u/s 51)
-Withholding tax adjustment u/s 93

Question 4

Sec 4(4)

Answer 4

Presumptive Tax

Resident natural persons with business income in Nepal

Conditions:
Turnover ≤ Rs. 30 Lakhs
Profit ≤ Rs. 3 Lakhs

Cannot claim
Medical tax credit
Withholding tax adjustment

Question 5

Sec 4(3)

Answer 5

Applicable to resident persons with only employment income

Conditions:
One employer at a time

Medical tax credit claimed via employer

Reduction for contribution to PF via employer

No reduction for donation (Sec 12)