TDS Return

Accurate withholding and timely submission of withholding details are essential to fulfill your statutory obligations. Present Consultants Private Limited delivers expert assistance to manage your transactions efficiently, ensuring absolute Tax Compliance in Nepal under the Income Tax Act, 2058.

₨ 1,000.00

Categories Business Compliance, Tax Services

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Introduction: TDS Return

Tax Deduction at Source (TDS) is a fundamental administrative mechanism utilized by the government to collect income tax at the very point of a transaction. Under the statutory framework governing Tax Compliance in Nepal, any person or corporate entity making specified payments—such as employee remuneration, rent, service fees, or contract payouts—must act as a withholding agent. The procedural method requires calculating the correct withholding percentage, making deductions at the time of payment or book-entry recording, depositing the withheld sum into the state treasury, and electronically filing a comprehensive TDS return on the Integrated Tax System (ITS) portal within the strict monthly deadlines set by the law.

Legal Requirements: Compliance Under the Income Tax Act, 2058

Pursuant to Chapter 17 of the Income Tax Act, 2058, specific transactions mandate tax deduction at source. Under Section 87 (Withholding of Tax on Employment Income), Section 88 (Withholding of Tax on Investment Returns and Service Fees), and Section 89 (Withholding of Tax on Contracts), the paying entity is designated as the tax withholding agent. Furthermore, Section 90(1) explicitly mandates that every withholding agent must deposit the deducted tax and submit a formal, itemized return to the Inland Revenue Department (IRD) within 25 days from the end of the month in which the tax was withheld. Our premier business consultancy Kathmandu assists companies in structuring their accounting ledgers to satisfy these legal requirements accurately.

Failing to file your TDS returns or delay the payment of withheld taxes carries heavy financial liabilities. Pursuant to Section 117(3) of the Income Tax Act, 2058, if a withholding agent fails to submit the monthly return within the prescribed deadline, they are liable to pay a fee calculated at 1.5% per annum of the tax amount required to be withheld for each month or part of the month during which the delay continues. Additionally, under Section 119, if the actual withheld tax is not deposited into the government treasury on time, interest at the rate of 15% per annum is charged on the outstanding balance, compounded from the original due date until the day of payment.

Process: TDS Return

Compute and Deduct Withholding Tax

Identify payments subject to withholding under Sections 87, 88, or 89, calculate the correct tax rate based on the payee’s tax status, and deduct the tax amount during invoice settlement or bookkeeping.

Deposit Withheld Amount and Generate Voucher

Log into the IRD taxpayer portal, navigate to the Payment Voucher module, generate a unique tax token for the deducted amount, and pay the sum into the treasury to clear your balance.

Log Entry Details into E-TDS Module

Access the E-TDS system on the portal, click on the submission module to get a new Submission Number, and enter the specific transaction dates, gross payments, and payee PAN details.

Transmit and Validate Electronic Return

Link your paid bank voucher number to your digital E-TDS entry sheet, run the integrated system validation check, and formally submit the return online to secure total corporate Tax Compliance in Nepal.

Ready to file your TDS Return?

Managing monthly withholding taxes accurately demands constant oversight and a precise understanding of evolving fiscal parameters. Present Consultants Private Limited provides reliable outsourced corporate tax care to manage your ledger computations, voucher generation, and portal filings without error. Contact our premier business consultancy Kathmandu today to safeguard your business from costly late-filing interest and system penalties.