Most employers in Nepal must register with the Social Security Fund (SSF) and deposit contributions for their staff every month. This guide covers the parts employers ask about most.
How much is contributed
The total contribution is 31% of the employee's basic salary:
- 11% is deducted from the employee's salary.
- 20% is paid by the employer on top of the salary.
The percentages are worked out on the basic salary, not on allowances, overtime or bonuses.
When to deposit
Contributions for a month are deposited by the 15th of the following Nepali month. Late deposits can attract interest and penalties, so it helps to have a reminder a week before.
How SSF affects salary tax
For SSF contributors, the first tax band (the 1% social security tax) is waived. Contributions also count toward the yearly retirement deduction, which lowers taxable income, up to the limit set in the Finance Act.
Keeping records
Keep each employee's SSF ID, the monthly contribution and the deposit receipt. You will need them when staff ask for statements or when the account is audited.
How WorkforceOS helps
WorkforceOS works out the employee and employer contributions on every payslip, gives you a monthly tax and SSF report, and reminds you 7 days and 1 day before the deposit date in the Compliance Center.
This is general information to help you plan, not legal or tax advice. Rules change with each budget; check the current rules with the SSF office, the Inland Revenue Department or your accountant.