Kathmandu, Shrawan 26 - The government has retained the 5% tax on the social media earning of content creators, including YouTube, TikTok and other digital platforms in Nepal. Inland Revenue Department (IRD) has kept the provision in the income tax structure for the current fiscal year.
The Inland Revenue Department (IRD) has said that those who receive payments in foreign currency for providing software or electronic services outside Nepal and provide payments to anyone through the uploading of audio-visual content on social media will be charged 5 percent tax on the amount received. The Tax will apply to income generated from platforms and digital services such as YouTube AdSense, TikTok Creator Rewards, Instagram bonuses, and Facebook in-stream ads. The tax deal also applies to income from sponsored posts, paid promotions, product reviews and affiliate commissions.
In the last fiscal year, the Government of Nepal introduced 5 percent tax on content creators’ social media earnings. The latest tax regime preserves the existing provision, but doesn't create a new tax on YouTubers and other social media creators. The tax is deducted at source (TDS) by banking institutions in Nepal from the amount paid in foreign currency to the recipient's local bank account for all payments that are made through the banking system.
The tax provision also applies to certain other types of digital income, such as online courses, downloadable digital products and online sales, in accordance with the nature of the income and tax provisions. If the tax continues, the Nepali YouTubers, TikTok creators, influencers and other digital content creators who earn a qualifying income from abroad will have to pay a 5 percent tax on such income in Nepal.
IRD has also released individual rates for business, salaries and small businesses and other types of taxpayers for the current fiscal year. But the 5% provision is still applicable to people who receive qualifying income from social media and some digital service providers.
Source: Republica
