For many businesses in Nepal, the end of every month means the same ritual: printing the attendance register, counting late arrivals and leave by hand, building salaries in Excel, then working out SSF and tax deductions — and hoping nothing was mistyped. As a team grows past ten or fifteen people, this becomes slow and error-prone. This guide covers what payroll involves in Nepal and how software takes over the repetitive parts.
This is general information, not legal or tax advice. Contribution rates and tax slabs are set by law and the annual budget, so confirm current figures with the Social Security Fund, IRD or your accountant.
1. Attendance: from register to fingerprint device
Fingerprint attendance machines (such as ZKTeco devices) are now common in Nepali offices, schools, hotels and factories. The value comes when those punches flow straight into payroll. Good software pulls punches from the device, compares them with each employee's roster or shift, and works out hours worked, late arrivals and absences automatically — no re-typing.
2. Rosters and shifts
Hotels, hospitals and restaurants don't work nine to five. A staff roster says who is expected when, so attendance can be read against the plan: was someone late for their 6 a.m. shift, or did they simply have the day off?
3. Leave
Annual leave, sick leave and public holidays (which follow the Nepali calendar) should be tracked per employee, with balances that update automatically.
4. Social Security Fund (SSF)
Under Nepal's contribution-based social security scheme, employers registered with the Social Security Fund contribute a share of each employee's basic salary, and employees contribute a share too — 20% from the employer and 11% from the employee, 31% in total, under the scheme's standard rates. Calculating this correctly on every payslip, and keeping a record for submission, is exactly the kind of work software should do.
5. TDS on salary
Employers deduct tax at source (TDS) from salaries according to the income tax slabs in force for the fiscal year, which runs from Shrawan to Ashadh. Slabs change with the budget, so payroll software must let rates be updated each year rather than hard-coding them.
6. Advances, payslips and reports
Salary advances (including those paid by cheque) should be deducted automatically in the following months. Each employee should receive a clear payslip, and the business should be able to produce tax and SSF reports for its accountant without rebuilding them by hand.
How our software helps
- HR & Payroll Software — employee records, biometric attendance integration, leave management, salary calculation with Nepal tax rules, PF, CIT and SSF calculations, payslips, IRD tax reports, appraisals and multi-branch support.
- SajhiloStay HMS — for hotels, HR and payroll are built in: staff rosters, ZKTeco fingerprint attendance, hours worked, payroll tax (TDS, SSF/CIT) and salary advances.
- School Management Pro — biometric attendance and salary processing for teachers and staff.
Frequently asked questions
We already have a fingerprint machine. Can we keep it?
Usually yes — ZKTeco and similar devices can be connected so punches flow into the system automatically.
What happens when tax slabs change in the budget?
Rates are configured, not hard-coded, so they can be updated for the new fiscal year.
Can managers see their own team only?
Yes. Role-based permissions limit who sees salaries and personal details.
Spending days on payroll every month? Contact OM IT Solutions and we'll show you payroll running from your own attendance data.