INCOME TAX ACT 2058

TAX DEDUCTION AT SOURCE (TDS)

“Paying tax is not just a legal responsibility, but also a matter of
earning respect.”

HIS MAJESTY’S GOVERNMENT
MINISTRY OF FINANCE
INLAND REVENUE DEPARTMENT
LAZIMPAT, KATHMANDU

Tax Deduct ion at source (TDS)

1. What is Tax Deduction at Source?

For a prescribed set of payments made in the course of busi ness or employment
or investment transactions, the Income Tax Act 2058 prescribes that tax (hence
referred to as TDS) must be deducted at the ti me of payment made by the payer
(hence referred to as TDS withholding agent) to the reci pient (hence referred to as
wi thhol dee).
The TDS withholding agent transfers the TDS deducted to the Inl and Revenue
Department either in cash, or by ch eque or draft, or through the bank.
In some cases TDS is treated as income tax pai d by the TDS wi thhol ding agent on
behal f of the TDS wi thhol dee. It can ther efore be claimed as a tax credit when
filin g in come t ax ret urn an d redu ces t he in come t ax liabilit y.

2. From which payments and at what rate must TDS be deducted?

A. Remunerati on payments
B. A resident person, when making rem uneration payments to employees, must
deduct TDS. TDS should be deducted at the ti me of payment and must be
deducted at the rate given in A nnex-1 of the Income Tax Act 2058.
For det ailed in format ion regardin g T DS calcu lation on remu nerat ion in come,
please refer to the brochure “Provision of Taxation fo r Remuneration Income in
Income Tax Act 2058”.
C. Interest payments, natura l source payments, rent payments, royalties, service
fees
A resident person, when ma king payments for i nterest s, natural sources, rent,
royalties or service fees, must deduct TD S at the rate of 15% of the payment.
How ever, if in terest is paid t o an individual for a depo sit, debenture or
government bond, only 6% TDS must be deducted.
D. Reti rement payments
? A resident person, when making reti rement payments, must deduct TDS
at the rate of 15% of the payment.
? When making lump sum retirement payments from HMG as well as
approved retirement funds, must deduct TDS at the rate of 6% of the gai n
of the payment. The gain is calculated by deductin g Rs 5 lakhs or 50% of
the lump sum retirement paym en t, w hich ever is h igh er.
? When making retirement payment from unapproved reti rement funds
must deduct TDS at the rate of 10% of the gain of the payment.
E. Di vidend and Investment i nsurance payment
A resident company, when distributing divi dend to its beneficiaries, must
deduct TDS at the rate of 5%. Similarl y, an investment insurance company,
when maki ng payment to i ts beneficiaries, must deduct TDS at the rate of 5%.
F. General insurance premiums
A resident person, when paying ou t business related general insurance
premiums, must deduct TDS at the rate of 1.5% of the in surance premium.
G. Business contracts
A resi dent person must wi thhol d TDS at the rate of 1.5% of the contractual
amount for contracts above Rs. 50,000.
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Tax Deduct ion at source (TDS)
Follow ing Table clarif ies t he T DS pay men t an d rat es:
Descri ption Tax Rate
Remunerati on
Individual Couple

up to Rs.80,000 +
Remote area allowance
+ Pensi on + Li fe
insurance premium
up to Rs.100,000 +
Remote area allowance
+ Pensi on + Li fe
insurance premium
Exempted
Any excess up to Rs.
75,000
Any excess up to Rs.
75,000 15%
Any excess amount Any excess amount 25% of excess amount + Rs.
11,250 (15% 0f 75,000)
Nepal sourced interest, na tural resource payment,
retirement payment, rent, royalty and service fee 15%
Interest pai d to an i ndividual for deposit,
debenture or government bond wi th no busi ness
relation
6%
Gain from lump sum retirement payment made
from H.M.G. or approv ed reti rement fund 6%
Gai n from Nepal source d retirement payment
made by an unapproved reti rement fund. 10%
Payment of Nepal source dividend by resident
company 5%
Payment of Nepal source investment insurance
gain by resident insurance company 5%
Payment of general insurance premium as a
business activity by a resident person 1.5%
Payment for business co ntracts amounti ng to
more than Rs. 50,000 1.5%

3. What are the types of TDS?
There are two types of TDS:
A. Final TDS
B. Non-fi nal (or adjustabl e) TDS .

4. What are final and non-final TDS?
A. Final TDS
The TDS that i s deducted from the payment by the TDS wi thhol ding agent
can not be u sed t o redu ce t he in come t ax liabilit y of the w ithholdee.
The pay men t it self is n ot con sidered in come of the w ithholdee w hen calcu lating
income t ax. It is simply ign ored w hen calcu lating t he in come t ax liabilit y of the
wi thhol dee.
B. Non-fi nal TDS
The TDS that i s deducted from the pa yment by the TDS wi thhol ding agent can
be u sed t o redu ce t he t ax liabilit y of the w ithholdee. The withholdee claims non-
final T DS as t ax credit s in An nex 10 (Form Income Tax-C-01-02-0960). Non-
final T DS redu ces t he in come t ax pay able ( i.e. tax liabilit y) of the w ithholdee
becau se it w as paid by the T DS w ithholdin g agen t on beh alf of the w ithholdee.
The pay men t it self is con sidered in come ( or an in clu sion ) of the w ithholdee
when calcu lating t he w itholdee’ s in come t ax liabilit y.

5. Which payments are subject to final TDS?
A. Payments of dividends by a resi dent company to it s beneficiaries.
B. Except i f in conjuncti on with business operations, pa yment of rent for the lease
of lan d or ( part of ) a bu ildin g an d it s associated fitting s and fixtures.
2

Tax Deduct ion at source (TDS)
C. Gain of payment made by a resident investment insurance company to an
insured.
D. Gain of payments made to resi dent persons from una pproved reti rement funds.
E. Payments made for i nterest on deposi ts to an i ndividual (not rel ated wi th
busi ness) by resi dent banks or fi nanci al insti tuti ons.
F. Any of the above listed payments made to non-resi dent persons.
G. Lump sum retirement payments made by HMG or an approved reti rement fund
to its beneficiries.
H. Payments made for meeting allowa nces, occasi onal teachi ng, prepari ng
questions and checking of answer sheets.

6. Are there any prescribed forms issued by the IRD to be used by TDS
withholding agents and withholdees with regard to TDS?
A. Wit hholdin g agen ts
• Form “Monthly Statement of Tax Wi thhel d” (Form Income Tax-T-D-01-01-
0361)
• Form “TDS Withholding Certificat e” (Form Income Tax-T-C-01-01-0361)
Specimen of these forms and procedures for compl eting them can be found
in Annex 1 of thi s brochure. Wi thhol dees
• Form “Income Tax / Annex 10 / Tax Cr edits Claim” (Form Income Tax-C-01-
02-0860)
• Prescri bed forms can be found from In land Revenue offi ce or i t can be
downl oaded from the IRD offi cial websi te www.i rd.gov.np.

7. When and where should TDS and TDS statements be submitted?
The T DS w ithholdin g agen t mu st su bmit The “Monthly Statements of Tax Withheld”
together wi th the TDS wi thhel d to the concerned Inl and Reve nue Offi ce unti l the
15 th day of the fol lowi ng month.

8. When and where should tax credit claims be submitted?
To claim tax credits, the TDS withholdee must submit Annex 10 (Form Income Tax-
C-01-02-0960) together with his income tax return.

9. When should TDS certificates be issued?
The T DS w ithholdin g agen t sh ou ld issu e a T DS cert ificat e ( Form In come T ax-T-C-
01-01-0361) within 15 days after the end of the month, when tax was deducted.
But, i n the case of remunerati on, the empl oy er sh ou ld issu e T DS cert ificat e w ithin
30 days after the end of i ncome year. In the case, where employee has been
terminated from the job, the employer shou ld issu e t his cert ificat e w ithin 30 day s
after the termi nati on.
Before issuing the TDS certif icate, the wi thhol ding agent must pay the TDS to hi s
Inl and Revenue Offi ce.
A specimen form and the procedures for co mpl eting i t can be found i n Annex-2 of
thi s brochure.

10. What happens if the withholding agent does not issue a TDS certificate t
o
the withholdee?
Wit hou t a T DS cert ificat e, the w ithholdee w ill n ot be able t o claim T DS credit s t o
redu ce h is t ax liabilit y, sin ce a T DS cert ificat e is requ ired in order t o fill in An nex 10
(Form Income Tax-C-01-02-0860).
Therefore every withholdee should ask the withholdin g agen t for a T DS cert ificat e.
TDS w ithholdin g agen ts are obliged t o issu e t his cert ificat e t o the w ithholdee.

11. What are the consequences if a person has not deducted mandatory TDS
from payments?
It is gen erally assu med t hat the T DS has been deducted where deduction is
compu lsory by law . It is primarily the obligat ion of the T DS w ithholdin g agen t to
deduct and pay the TDS. However, if the withholdin g agen t fails t o pay the T DS,
both he and the withholdee are jointly or in dividually liable to pay the tax. If TDS
was pai d by the wi thhol ding agent but not yet deducted duri ng the ti me of
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Tax Deduct ion at source (TDS)
payment, the TDS wi thhol ding agent i s au thori zed to recover the TDS pai d from
the withholdee.
12. What happens if the TDS withholding agent fails to pay TDS at the
concerned Inland Revenue Office?
If the agent fai ls to pay the TDS wi thi n the prescribed period, the agent must pay
15% annual interest on the amount each month.
In addi tion, the concerned Inl and Revenue Offi ce i s authori zed to enforce the
pay men t using all legal mean s of en forcemen t as described in the In come T ax Act
2002.

13. What will happen if the agent fails to submit a TDS statement to the
concerned Inland Revenue Office?
If the agent fails to submit a statem ent (Form Income Tax-T-D-01-01-0361) until
the 15 th day of the months fol lowi ng the l atest TDS payments, then the agent i s
liable to pay 1.5% i nterest per annum on the TDS.
A TDS statement need not be submitted for months i n whi ch no TDS was deducted.

14. Where can more information regarding TDS be found?
To get more information regarding TDS, contact the Inl and Revenue Department or
the nearest Inland Revenue Offi ce. Additionally, Section 2, Chapters 16, 17, 20, 22 ,
23 and Annex 1 of the Income Tax Act 2058 contain detailed legal provisions
rel ating to TDS.
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Tax Deduct ion at source (TDS)
Annex-1
Form Inc ome tax-T -D-01-01-0361
MONTHLY STATEMENT OF TAX WITHHELD As per Se ction 90 of Inc ome Tax A ct 2002, the follow ing a re the details of the tax w ithhe ld a nd the payment made at the Inla nd Revenue Offic e.
Statement Pe riod IRO Name________________________________ _________________ _ YYYY MM

1 WITHHOLDING AGENT DETAILS
PAN (if available)
Nam e
Address House/ Block No. Ward No. Street Metropolitan Sub-Metropolitan Municipality VDC District

2 PAYMENT DETAILS Fill in a ll ta x pa yments m ade for TDS during the sta tement pe riod. Payments c an be made for ta xes withhe ld for (1) e mploy ment / salary, (2) inte rests, (3) na tura l resourc e payments, (4) re nt, (5) roy alties, (6) se rvic e fees, (7) re tire ment pa yments, (8) divide nds, (9) contra ct payments, (10) insurance p remiums. Colum n 1 Fill in the revenue account h eading for which the paym ent was m ade. Colum n 2 Fill in “1” for c ash pa yment, “2” for c heque payment, “3” for dra ft pa yment, “4” for pa yment through ba nk. Colum n 3 Fill in (A) cash receipt num ber if you paid cas h in the IRO, (B) cheque num ber if you paid by cheque in the IRO, (C) d raft num ber if y ou pa id by dra ft in the IRO, (D) vouc her num ber if y ou pa id in the bank. Colum ns 4, 5 Fill in the bank na me and the bra nch name if y ou pa id by bank vouc her. Colum n 6 Fill in the IRO na me if y ou pa id in c ash or by cheque or by dra ft in the IRO. Colum n 7 Fill in the payment da te. Colum n 8 Fill in the amount of ta xes de duc ted and pa id.
1 2 3 4 5 6 7 8
SN Revenue Account Heading Payment Mode Num ber Bank Nam e Bank Branch Nam e IRO Nam e Payment Date Amount
1
2
3
4
5
6
7
8
9
10
TOTAL AMOUNT
3 TAX PAYER CERTIFICATION I/we d eclare this statement to be complete and correct.
Signa ture of Withholding A gent or R epresentative
Name of Withholding A gent or R epresentative
Date

4 OFFICIAL USE ONLY
TDS Retu rn No
TDS R eturn Da te
Recei ving Official Nam e
Recei ving Official Signature
FILL I N BACK S IDE F OR WI THOLDEES DETAI LS
5

Tax Deduct ion at source (TDS)
5 PAN HOLDER WITHHOLDEES DETAILS (Fill in only for Withholde es with PA N) Type of Witholding (fill num ber in le ft colum n) 3= Natural resource pay ment, 4= Rent, 5= Roy alty, 6=S ervice fee, 7= Retirem ent pay ment, 8=Contract
or General Insurance premium Do not fill in De tails (R ows 2-13) for (1) Em ploy ment / Sa lary Earners, (2) R ecipients of Inte rests, (3) R ecipients of Divide nds. Fill in Subtota ls (Rows 15-17) only .
A B C D E F
Payment Da te (of c ol. 5) 1 Type Whd. Withholde e PA N Withholde e Name YYYY MM DD
Amount pa id to Withholde e TDS A mount withhe ld
2
3
4
5
6
7
8
9
10
11
12
13
14 Subtota l Rows 2-13
15 Subtota l Employ ment / Sa lary Earners
16 Subtota l Recipients of Inte rests
17 Subtota l Recipients of D ivide nds
18 Total of R ows 14-17

6 NON-P AN HOLDER WITHHOLDEES DETAILS (Fill in only for Withholde es without PA N) Type of Witholding (fill num ber in le ft colum n) 3= Natural resource pay ment, 4= Rent, 5= Roy alty, 6=S ervice fee, 7= Retirem ent pay ment, 8=Contract
or General Insurance premium Do not fill in De tails (R ows 2-13) for (1) Em ploy ment / Sa lary Earners, (2) R ecipients of Inte rests, (3) R ecipients of Divide nds. Fill in Subtota ls (Rows 15-17) only .
A B C D E
Payment Da te (of c ol. 5) 1 Type Whd. Withholde e Name YYYY MM DD
Amount pa id to Withholde e TDS A mount withhe ld
2
3
4
5
6
7
8
9
10
11
12
13
14 Subtota l Rows 2-13
15 Subtota l Employ ment / Sa lary Earners
16 Subtota l Recipients of Inte rests
17 Subtota l Recipients of D ivide nds
18 Total of R ows 14-17

6

Tax Deduct ion at source (TDS)
Procedures for filling out a monthly TDS statement

Explanation and filling procedur e of monthly TDS statement
(Form Income Tax-T-D-01-01-0361)

Who should fill this form
A w ithholdin g agen t, w ho dedu cts t ax from a w ithholdee, sh ou ld f ill t his st atemen t.

Where to find this form
This form can b e obtained from any I.R.O. T his form can also be downloaded from the
I.R.D. website: https://www.i rd.gov.np/ .

Where to submit this statement
After compl ete a statement, i t shoul d be submitted to the concerned I.R.O.

When to submit statement
Wi thi n 15 days of the end of the mont h when the payment was made to the
wi thhol dee.

How to fill this form
Complet e all t he row s an d colu mn s of this f orm w ith all t he correct in format ion .
• Period of TDS : mention the year and mo nth that payment was made after TDS.
• Name of the I.R.O. : menti on the name of I.R.O. where the statement is to be
submitted.

PART 1 – Withholding agent’s details
Complet e all t he row s an d colu mn s of this sect ion w ith all t he correct in format ion .

PART 2 – Tax payment details
• For each rev enue headin g, on e row sh ou ld be f illed. There migh t be t he same
revenue headi ng number i n di ffe rent rows on page 2. In thi s case, the total of al l
the rows wi th the same revenue headi ng number shoul d be menti oned i n a si ngl e
row for each revenue heading.
• There are 8 colu mn s in this sect ion . In stru ction s on how to fill colu mn s are prin ted
at the t op of the t able on the f orm. Wh en fillin g t he t able, these in stru ction s mu st
be followed.

PART 3 – Taxpayer certification
The withholding agent should sign and date th is section. A representative of the agent
can also sign the statement, as long as a Letter of Authori zati on i s attached.

PART 4 – For official use
The w ithholdin g agen t sh ou ld n ot w rite in this sect ion . This sect ion is to be filled by
I.R. O. st aff on ly. T he w ithholdin g agen t should keep a record of the statement
regist rat ion number an d t he dat e from t his part , w hich w ill be u sed t o prepare a T DS
cert ificat e.

PART 5 – Details of withholdees having a PAN
Detai ls of wi thhol dees havi ng a PAN (P ermanent Account Number) shoul d be
men tion ed in this sect ion . D etails of w ithholdees withou t PAN sh ou ld not be menti oned
in this section (see the next section for wher e to place detai ls of wi thhol dees wi thout a
PAN). Instructions on how to complete th e rows and columns in this section are
prin ted at the t op. Wh en fillin g t he t able, these in stru ction s mu st be f ollow ed.
7

Tax Deduct ion at source (TDS)
PART 6 – Details of withholdees without PAN
Details of withholdees withou t PAN sh ou ld be men tion ed in this sect ion . D etails of
wi thhol dees havi ng a PAN shoul d not be me ntion ed in this sect ion ( see P art 5 f or
where to place the details of withholdees with a PAN). Instructions on how to complete
the row s an d colu mn s in this sect ion are prin ted at the top. Wh en fillin g the table,
these in stru ction s mu st be f ollow ed.

The fo llo wing is an example o f a co mpleted TDS statement where the
Social Co-operation Institute ha s to fill out a TDS statement:
The detais of TDS made by the Social Co-operation Institute, resident of
block no. 14, ward No.34, Kathmandu municipality having PAN
500001021 on the month of Faigoon, 2060, are as follows:
1. TDS Rs. 60,000 was made on the payment of remuneration, paid by
cheque no. 234510, dated 060/12/13 of Nepal Bank Ltd., Dillibazar
branch to I.R.O. No. 1, Kathmandu.
2. Rs. 42,500 was paid to the Old Plaza Pvt. Ltd. for rent on 060/11/29
and Rs. 7,500 was deducted as tax. This amount was paid to I.R.O.
No. 1, Kathmandu on 060/12/13. The I.R.O. issued a receipt
numbered 234511. The Old Plaza has a PAN: 500001111.
3. Rs. 4,75,000 was paid to a consultancy company as a service fee on
060/11/20 and Rs. 75,000 was deducted as tax. This amount was
paid to Nepal Rastra Bank, Thapathali by Bank Voucher No. 1234560
dated 060/12/13 on the account of I.R.O. No. 1, Kathmandu. The
PAN of the consultancy company is 500002132.
4. Rs. 85,000 was paid as a service fee to Dr. Kabir Kumar on
060/11/29 and Rs. 15,000 was deducted as tax. This amount was
paid to Nepal Rastra Bank, Thapathali by Bank Voucher No. 1234560
dated 060/12/13 on the account of I.R.O. No. 1, Kathmandu. Dr.
Kumar does not have a PAN.
8

Tax Deduct ion at source (TDS)
Sample of filled TDS Statement Form Inc ome tax-T -D-01-01-0361
MONTHLY STATEMENT OF TAX WITHHELD As per Se ction 90 of Inc ome Tax A ct 2002, the follow ing a re the details of the tax w ithhe ld a nd the payment made at the Inla nd Revenue Offic e.
Statement Period 2060 11 IRO Name : N o.1, Kathm andu ________________________________ ____ YYYY MM

1 WITHHOLDING AGENT DETAILS
PAN 5 0 0 0 0 1 0 2 1 (if available)
Name Soc ial Co-ope ration Institute
Address House/ Block No. Ward No. Street Metropolitan Sub-Metropolitan Municipality VDC District
14 34 Baneswore Kathm andu Kathm andu

2 PAYMENT DETAILS Fill in a ll ta x pa yments m ade for TDS during the sta tement pe riod. Payments c an be made for ta xes withhe ld for (1) e mploy ment / salary, (2) inte rests, (3) na tura l resourc e payments, (4) re nt, (5) roy alties, (6) se rvic e fees, (7) re tire ment pa yments, (8) divide nds, (9) contra ct payments, (10) insurance p remiums. Colum n 1 Fill in the revenue account h eading for which the paym ent was m ade. Colum n 2 Fill in “1” for c ash pa yment, “2” for c heque payment, “3” for dra ft pa yment, “4” for pa yment through ba nk. Colum n 3 Fill in (A) cash receipt num ber if you paid cas h in the IRO, (B) cheque num ber if you paid by cheque in the IRO, (C) d raft num ber if y ou pa id by dra ft in the IRO, (D) vouc her num ber if y ou pa id in the bank. Colum ns 4, 5 Fill in the bank na me and the bra nch name if y ou pa id by bank vouc her. Colum n 6 Fill in the IRO na me if y ou pa id in c ash or by cheque or by dra ft in the IRO. Colum n 7 Fill in the payment da te. Colum n 8 Fill in the amount of ta xes de duc ted and pa id.
1 2 3 4 5 6 7 8
SN Revenue Account Heading Payment Mode Num ber Bank Nam e Bank Branch Nam e IRO Nam e Payment Date Amount
1 1–1–03–20 2 234510 Nepal Bank Ltd. Dillibazar branch X 2060. 12.13 60000.00
2 1–1–03–51 1 234511 X X No. 1, Kathm andu 2060. 12.13 7500. 00
3 1–1–03–90 4 1234560 Nepal Rastra Bank Thapathali bra nch X 2060. 12.13 90000.00
4 X
5 X
6 X
7 X
8 X
9 X
10 X
TOTAL AM OUNT 157500.00

3 TAX PAYER CERTIFICATION I/we d eclare this statement to be complete and correct.
Signa ture of Withholding A gent or R epresentative
Name of Withholding A gent or R epresentative
Date 2060.12.14

4 OFFICIAL USE ONLY
TDS Return No 12345
TDS R eturn D ate 2060. 12.14
Recei ving Official Nam e
Recei ving Official Signature
FILL I N BACK S IDE F OR WI THOLDEES DETAI LS
9

Tax Deduct ion at source (TDS)
5 PAN HOLDER WITHHOLDEES DETAILS (Fill in only for Withholde es with PA N) Type of Witholding (fill num ber in le ft colum n) 3= Natural resource pay ment, 4= Rent, 5= Roy alty, 6=S ervice fee, 7= Retirem ent pay ment, 8=Contract
or General Insurance premium Do not fill in De tails (R ows 2-13) for (1) Em ploy ment / Sa lary Earners, (2) R ecipients of Inte rests, (3) R ecipients of Divide nds. Fill in Subtota ls (Rows 15-17) only .
A B C D E F
Payment Da te (of c ol. 5)
1 Withhol dee PAN Withhol dee Name YYYY MM DD
Amount pa id to Withholde e TDS A mount withhe ld
2 2 5 0 0 0 0 1 1 1 1 Old Pl aza Pvt. Ltd. 2060 11 29 4 2 5 0 0 7 5 0 0
3 4 5 0 0 0 0 2 1 3 2 Consul tancy company 2060 11 20 4 2 5 0 0 0 7 5 0 0 0
4 X
5 X
6 X
7 X
8 X
9 X
10 X
11 X
12 X
13 X
14 Subtotal Rows 2- 13 8 2 5 0 0
15 Subtota l Employ ment / Sa lary Earners X
16 Subtota l Recipients of Inte rests X
17 Subtota l Recipients of D ivide nds X
18 Total of R ows 14-17 8 25 0 0

6 NON-P AN HOLDER WITHHOLDEES DETAILS (Fill in only for Withholde es without PA N) Type of Witholding (fill num ber in le ft colum n) 3= Natural resource pay ment, 4= Rent, 5= Roy alty, 6=S ervice fee, 7= Retirem ent pay ment, 8=Contract
or General Insurance premium Do not fill in De tails (R ows 2-13) for (1) Em ploy ment / Sa lary Earners, (2) R ecipients of Inte rests, (3) R ecipients of Divide nds. Fill in Subtota ls (Rows 15-17) only .
A B C D E
Payment Da te (of c ol. 5) 1 Type Whd. Withholde e Name YYYY MM DD
Amount pa id to Withholde e TDS A mount withhe ld
2 4 Dr. Kabi r Kumar 2060 11 29 8 5 0 0 0 1 5 0 0 0
3 X
4 X
5 X
6 X
7 X
8 X
9 X
10 X
11 X
12 X
13 X
14 Subtotal Rows 2- 13 1 5 0 0 0
15 Subtota l Employ ment / Sa lary Earners 6 00 0 0
16 Subtota l Recipients of Inte rests X
17 Subtota l Recipients of D ivide nds X
18 Total of R ows 14-17 7 50 0 0

10

Tax Deduct ion at source (TDS)
Annex-2
For m Incom e tax- T-C-01- 01- 0361
TDS WITHHOLDING CERTIFICATE
(For the purpose of Income Tax Act 2002, Section 91)
1 WITHHOLDEE DETAILS

PAN (if available)
Name
Phone No.
Address House/ Block N o. Ward No . Street Metropolitan Sub-Metropolitan Municipality VDC District

2 WITHHOLDING AGENT DETAILS

PAN (if available)
Name
Phone No.
Address House/ Block N o. Ward No . Street Metropolitan Sub-Metropolitan Municipality VDC District

3 PAYMENT DETAILS

Payment heading after TDS

Remuneration Service fe
Interes t Retirem ent pay ment
Natural res ource pay ment Dividend
Rent Contract
Roy alty General Insurance premium
Revenue Account Heading of
TDS Pa yment

(tick one only )
1-1-03-11 (Government Organisation) 1-1-03-12 (Public Limited Company )
1-1-03-13 (Private Limited Company ) 1-1-03-14 (Individual/Proprietorship Firm)
1-1-03-19 (Other Institutions) 1-1-03-20 (Remuneration Tax)
1-1-03-51 (Rental Tax) 1-1-03-52 (Interest Tax)
1-1-03-53 (Capital Gain Tax) 1-1-03-54 (Dividend Tax)
1-1-03-59 (Other Investment Tax) 1-1-03-90 (Other Income Tax)
Period Pay ment covers (put month and y ear in the fields below)
From
To
Amount paid to Withholdee
Amount in Words
TDS Amount withheld
Amount in Words
Pay ment Date
TDS Return Registration No.
TDS Return Registration Date
Name of the I. R.O.

____________________________________________ ____________________________________________
D ate and s eal
Si gna ture Wi thol ding Age nt
11

Tax Deduct ion at source (TDS)
Procedures for filling out a TDS Certificate

Explanation and filling procedure of TDS Certificate (Form
Income tax-T -C-01-01-03-61)
Who should fill this form
Af ter pay ing the dedu cted tax in an I. R. O. , a w ithholdin g agen t sh ou ld f ill ou t a T DS
cert ificat e an d issu e it to the w ithholdee.
Where to find this form
This form can b e obtained from any I.R.O. T his form can also be downloaded from the
I.R.D. website: https://www.i rd.gov.np/

When to issue a TDS certificate
1. In the case of an employee,
A. If empl oyment i s conti nued, wi th in 30 days of the end of the year,
B. If employment has been terminated with in the year, wi thi n 30 days of the date
of termin ation .
2. In other cases, within 15 days after th e end of the month when tax was deducted.

How to fill this form
Complet e all t he row s an d colu mn s of this f orm w ith all t he correct in format ion .

PART 1 – Withholdee’s details

Complet e all t he row s an d colu mn s of this sect ion w ith all t he correct in format ion .

PART 2 – Withholding agent’s details

Complet e all t he row s an d colu mn s of this sect ion w ith all t he correct in format ion .
PART3 – Tax payment details
Payment headi ng
after TDS

Please tick only one box for th e payment headi ng for whi ch you
have paid after deduction of tax.
Revenue Account
Heading of
TDS Payment
Please tick only one box for th e revenue headi ng for whi ch you
have paid the deducted tax am ount. If you have pai d under
different headi ngs for one wi thhol dee, you shoul d issue a separate
certificate for each revenue heading.
Period of TDS
applicable
payments
There are t wo row s below this colu mn . Mention Period of pay men t
after TDS means from whi ch peri od to whi ch peri od the payment
was made. The start month shoul d be menti oned i n the upper
row, whereas the end month shou ld be men tion ed in the low er
row. For example, if payment was made in 2061 Baishakh, then
2061 Baishakh should be mentio ned in both rows. If the
certificate is being prepared for the fiscal year 060/61, 2060
Shrawan should be mentioned in the upper row and 2061 Ashad
sh ou ld be men tion ed in the low er row .
Payment made to
wi thhol dee
Fill in the amou nt paid t o w ithholdee in numbers.
In w ords Fill in the amou nt paid t o w ithholdee in w ords.
TDS amou nt Fill in the amou nt of TDS in numbers.
In w ords Fill in the amou nt of TDS in w ords.
Payment date Fill in the dat e w hen tax w as paid t o the I. R. O.
TDS statement
filin g n umber

Fill in the regist rat ion number of your st atemen t from t he I. R. O.
12

Tax Deduct ion at source (TDS)
TDS statement
filin g dat e

Fill in the regist rat ion dat e of your st atemen t from t he I. R. O.
Name of the
I.R.O.
Fill in the I. R. O. name, w here T DS st atemen t w as su bmit ted.

• Print the date when the certificate was prepared and stamped with
the office seal.
• Sign in the specified place. The withholding agent or the
authorized person can sign the certificate.

The following is an example of a comp leted TDS certificate where the Social
Co-operation Institute has to issue a TDS certificate to the Old Plaza:
The Social Co-operation Institute, resident of block no. 14, ward no.
34, Kathmandu municipality with PAN 500001021 has deducted tax on
2060 Falgun. Rs. 7,500 was deducted and Rs. 42,500 was paid as rent
to the Old Plaza Pvt. Ltd. This TDS was paid in I.R.O. No. 1, Kathmandu
on 060/12/13. I.R.O. No. 1, Kath mandu has issued a receipt (No.
234511). Old Plaza was the resident of block no. 12, ward no. 32,
Gyaneswore, Kathmandu municipa lity, Phone No. 4444444 with PAN
500001111.
The Society had submitted TDS return in I .R.O. N o. 1 , K athm andu o n
060/12/14. The TDS return registration No. was 12345.
13

Tax Deduction at source (TDS)
14
Sample completed TDS certificate Form Income tax-T-C-01-01-0361
TDS WITHHOLDING CERTIFICATE
(For the purpose of Income Tax Act 2002, Section 91)

1 WITHHOLDEE DETAILS

PAN 5 0 0 0 0 1 1 1 1 (if available)
Name Old Plaza Pvt. Ltd.
Phone No. 4444444
Address House/
Block No. Ward No. Street Metropolitan Sub-Metropolitan Municipality VDC District
12 32 Gyaneswore Kathmandu Kathmandu+
2 WITHHOLD
ING AGENT DETAILS

PAN 5 0 0 0 0 1 0 2 1 (if available)
Name Social co-operation institute
Phone No. 4888888
Address House/
Block No. Ward No. Street Metropolitan Sub-Metropolitan Municipality VDC District
14 34 Banneswore Kathmandu Kathmandu

3 PAYMENT DETAILS

Payment heading after TDS

Remuneration Service fee
Interest Retirement payment
Natural resource payment Dividend
Rent Contract
Royalty General Insurance premium
Revenue Account Heading of
TDS Payment

(tick one only)
1-1-03-11 (Government Organisation) 1-1-03-12 (Public Limited Company)
1-1-03-13 (Private Limited Company) 1-1-03-14 (Individual/Proprietorship Firm)
1-1-03-19 (Other Institutions) 1-1-03-20 (Remuneration Tax)
1-1-03-51 (Rental Tax) 1-1-03-52 (Interest Tax)
1-1-03-53 (Capital Gain Tax) 1-1-03-54 (Dividend Tax)
1-1-03-59 (Other Investment Tax) 1-1-03-90 (Other Income Tax)
Period Payment covers (put month and year in the fields below)
From 2060, Falgun
To 2060, Falgun
Amount paid to Withholdee 4 2 5 0 0
Amount in Words Forty two thousand five hundred only
TDS Amount withheld 7 5 0 0
Amount in Words Seven thousand five hundred only
Payment Date 2060.12.13
TDS Return Registration No. 12345
TDS Return Registration Date 2060.12.14
Name of the I.R.O. I.R.O. No. 1, Kathmandu

2060.12.14
**********
____________________________________________ ____________________________________________
Date and seal
Signature Witholding Agent