Nepal Statutory social-insurance contributions

What this value means

WHAT A PAYROLL ENGINE GETS WRONG IN NEPAL. 1. THE HEADLINE IS 11 % EMPLOYEE + 20 % EMPLOYER = 31 %, AND THE FOUR SCHEME PERCENTAGES ARE AN ALLOCATION OF THAT SAME 31 %, NOT ADDITIONS TO IT. Section 25 of the Procedure is explicit: the employer deducts 11 % of the worker's basic remuneration, adds 20 % of basic remuneration of its own, deposits the combined 31 % with the Fund, and the FUND then splits it — 1 % to medical/health/maternity, 1.40 % to accident and disability, 0.27 % to dependent family, 28.33 % to old age. Summing the scheme percentages on top of the 31 % double-counts the entire contribution. 2. THE BASE IS BASIC REMUNERATION, NOT GROSS PAY. "आधारभूत पारिश्रमिक" excludes allowances, overtime and the dearness component. Running 31 % over gross remuneration over-collects on essentially every Nepali payslip, because Nepali pay structures carry a substantial allowance element by design. Conversely, an employer cannot depress the contribution indefinitely by shrinking basic pay: the Labour Act and the minimum-wage notification fix a basic component that the contribution base cannot fall below. 3. NO CEILING AND NO FLOOR. Unlike almost every other country in this dataset, Nepal caps nothing: 31 % runs on the whole basic remuneration however large, and there is no minimum-wage basing rule and no low-earner exemption. Employer cost is a flat 20 % of basic pay at every income level. 4. THE SSF REPLACES PROVIDENT FUND AND GRATUITY — IT DOES NOT SIT ON TOP OF THEM. Section 19(1) constructs the old-age scheme out of exactly the Labour Act obligations it displaces: the employer's 10 % in lieu of provident fund, the employer's 8.33 % in lieu of gratuity, and the worker's 10 % in lieu of provident fund. An employer enrolled in the Fund that ALSO runs a provident fund at 10 % + 10 % and accrues gratuity at 8.33 % is paying twice. The old regime — provident fund under the Labour Act with the Employees Provident Fund, plus gratuity, plus a separately purchased accident and medical insurance for workers — remains the position only for employment not yet brought within the Fund; for enrolled employers it is superseded. 5. THE FOUR SCHEME PERCENTAGES DO NOT SUM TO 31 WITHOUT THE 0.27. 1 + 1.40 + 0.27 + 28.33 = 31.00 exactly. Drop the dependent-family 0.27 and the arithmetic silently fails by 0.27 points; most secondary summaries of Nepal either omit it or quote a different split. 6. WATCH FOR COMPETING SPLITS IN CIRCULATION. Several widely repeated summaries give the allocation as 1.20 / 0.80 / 0.67 / 28.33, which also totals 31. The figures served here — 1 / 1.40 / 0.27 / 28.33 — are read verbatim off section 25 of the Fund's own current Operating Procedure and are the operative ones. 7. BENEFITS ARE QUALIFYING-PERIOD GATED AND CO-PAID. Three continuous months of contribution for medical and maternity cover, two years for the critical-illness scheme; cover continues for three months (or two years, respectively) after contributions stop; the contributor bears 20 % of any medical claim; and the medical benefit is capped at NPR 100 000 per financial year. Sick pay and maternity pay from the Fund run at 60 % of basic remuneration and only after the employer's statutory paid leave is exhausted, with sick pay stopping after thirteen weeks in a year and maternity payment limited so that the Fund's period plus the sixty days payable by the employer under Labour Act s. 45(3) does not exceed ninety-eight days. 8. THE CONTRIBUTION AND THE INCOME TAX INTERACT. Contributions to the Fund are deductible for income tax within the statutory retirement-contribution limit, and an employee enrolled in the Fund is treated differently in the first income tax slab from one who is not — enrolment removes the one per cent social security tax charged on the first slab of a non-contributor's income. An engine that models the payroll deduction without the tax consequence will overstate net pay for non-contributors and understate the value of enrolment. 9. IT IS THE EMPLOYER'S JOB TO REMIT BOTH SIDES, MONTHLY. The employer deducts, adds and deposits the whole 31 % with the Fund; a contributor's period of membership is counted from the first day of the month in which the money actually reaches the Fund, so late deposit costs the worker qualifying time, not just the employer a penalty. SUB-NATIONAL VARIATION: none in the rates. The 31 % and its allocation are national. The Fund operates provincial branch and contact offices and constitutes Health Examination Committees on a provincial basis, but no province sets a rate. WHAT WE DO NOT PUT A NUMBER ON: THE EMPLOYEE/EMPLOYER SPLIT OF THE THREE SMALL SCHEMES — deliberately null. The Procedure fixes the aggregate split (11 % worker, 20 % employer) and separately fixes the composition of the OLD-AGE scheme (worker 10 %, employer 18.33 %). It does not divide the medical, accident or dependent-family allocations between the two sides. The residual arithmetic — 1 point of worker money and 1.67 points of employer money spread across those three schemes — is derivable but is not stated in the instrument, so it is not served as though it were. THE MINIMUM WAGE AND ITS BASIC/DEARNESS SPLIT — not served here. It bounds the contribution base in practice but is a separate series set by ministerial notification and revised on its own cycle. THE OLD PROVIDENT FUND AND GRATUITY RATES AS A LIVE ALTERNATIVE — described but not served as branches. The Labour Act, 2074 regime of 10 % + 10 % provident fund and 8.33 % gratuity is superseded for employers enrolled in the Fund and is retained here only as context, because it is the single most common source of double-counting in Nepali payroll. SELF-EMPLOYED, INFORMAL-SECTOR AND FOREIGN-EMPLOYMENT CONTRIBUTION RATES — outside the scope of an employed-person record. The Fund has extended contribution-based cover to self-employed, informal and migrant workers on their own terms and rates, which are not the 11/20 split. SOURCING CAVEATS: Every percentage served is read verbatim from the Social Security Fund's own published consolidated text of the Social Security Scheme Operating Procedure, 2075 (third amendment), sections 19 and 25, and the operative Nepali wording is quoted in the instrument fields. That document is typeset in a legacy Nepali font, so the text was decoded before reading; the numerals and the section structure are unambiguous, and sections 19 and 25 corroborate one another on the 28.33 figure. The enabling provisions cited from the Contribution Based Social Security Act, 2074 (sections 10 and 70(2)) are as recited in the Procedure's own preamble rather than read from the Act. The effective date is given as the launch of the contribution-based scheme in November 2018; the Procedure was approved on 2075/08/06 and the current allocation percentages have not moved since, though the third amendment (approved 2079/06/05, commencing on the 91st day thereafter) added the critical-illness scheme and altered several benefit limits. The income tax interaction in note 8 is stated in general terms because it comes from the Income Tax Act and the annual Finance Act rather than from the Procedure, and no rate for it is served.

Get it programmatically

curl https://asiaref.dev/v1/np/social-contributions
# $0.005 per call — x402 on Base (USDC). No key, no signup.
# History:    curl https://asiaref.dev/v1/np/social-contributions/history?from=2020-01-01
# Provenance: curl https://asiaref.dev/provenance/np/social-contributions

Other Nepal series: NRB policy rate (fixed repo rate) · VAT standard rate · VAT registration threshold · National minimum remuneration · Public holidays · Consumer price inflation (year-on-year) · Corporate income tax standard rate · Withholding tax rates · Statutory late-payment interest · Personal income tax bands

The same figure elsewhere: Oman · Pakistan · Philippines · Qatar · Saudi Arabia · all 28