Nepal moves to tax local staff of UN agencies, diplomatic missions
Summary
Nepal's new Finance Bill requires locally employed staff of UN agencies, international organisations and diplomatic missions to pay income tax, excluding diplomats with diplomatic status.
Key Points
- The Finance Bill introduces income tax provisions for Nepali nationals and foreign residents working locally for UN agencies, international organizations, and diplomatic missions.
- Diplomats with diplomatic status continue to enjoy tax exemptions under the Vienna Convention.
- Locally recruited staff without diplomatic privileges must now pay income tax as per Nepal’s Income Tax Act.
- A three-year tax settlement concession with a one percent additional charge is available until mid-December 2026 for eligible employees.
