Income Tax Rates 2077-78 (2020-21)

August 6, 2020


Introduction

Finance Act 2077-78 (2020-21) ("Finance Act") was passed by the Parliament and received Presidential assent on June 29, 2020. Finance Act came into effect from the beginning of fiscal year 2077-78 (2020-21) i.e., Shrawan 1, 2076 (July 16, 2020). A Finance Bill is introduced by the GON annually at the Parliament and encompasses all amendments required in various tax legislations.

With respect to income tax, the Income Tax Act 2058 (2002) ("ITA") forms the framework law. This Briefing highlights major aspects of ITA as amended by Finance Act.

Major Highlights


The following tables provide rates of income taxes, withholding taxes, advance taxes, and details of tax exemptions and tax concessions.

1. Personal Income Tax

Schedule 1(1) of ITA as amended by the Finance Act prescribes progressive income tax rates which are applied on the income falling within each tax bracket.....

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