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What should I know about hiring in Nepal?
Hiring talents from Nepal can bring a vast of new opportunities for your business, but it also imposes many challenges. Before making your hire in the country, it’s essential to assess legal aspects such as labour laws, employment contracts, payroll procedures, and tax requirements.
Besides staying compliant with labour laws, it’s also important to be aware of cultural norms and practices. Nepal’s business culture emphasises respect and hierarchy, so it’s important to maintain professional relationships and offer competitive compensation packages.
Why is Nepal a good choice for finding remote employees?
Compared to some Western countries, Nepal is very cost-effective when it comes to employing a workforce. Not only does this mean lower employee costs for businesses, but it also allows them to offer competitive compensation packages without significant cost increases.
Nepal is also considered one of the countries with a constantly growing pool of skilled and educated workers. Many Nepali professionals hold degrees from reputable universities in fields such as IT, engineering and design. Combined with Nepal’s strong work ethic and loyalty values, hiring in Nepal can open many opportunities for businesses that hire remote workers.
Finally, to promote the country’s development, Nepal’s government takes initiatives to support the growth of IT and digital sectors. As such, it’s a favourable environment for foreign startups that want to expand and hire a remote workforce.
How can Native Teams help you hire in Nepal?
Native Teams can assist you in staying compliant with Nepali labour laws while expanding your business there. Our EOR and PEO solutions will help you navigate the complexities of Nepali employment regulations and the unique business and cultural landscapes.
Hire your first Nepali employee with Native Teams.
Legal requirements for hiring in Nepal
Minimum wage
The minimum monthly wage in Nepal is NPR 15,000.
Contributions & taxes
Employer tax
The employer tax in Nepal is 10%.
Corporate tax
The corporate tax in Nepal is 25% for the majority of business sectors.
Employee tax
The employee tax in Nepal is 10%.
Income tax
Individual income tax in Nepal is submitted progressively:
- NPR 500.000 and below – 1%
- From NPR 500.001 to NPR 700.000 – 10%
- From NPR 700.001 to NPR 1.000.000 – 20%
- From NPR 1.000.001 to NPR 2.000.000 – 30%
- From NPR 2.000.001 to NPR 5.000.000 – 36%
- NPR 5.000.001 and above – 39%
To calculate the salary and taxes in Nepal please click here.
Payroll cycle
The payroll cycle in Nepal runs monthly.
Is there a 13th salary in Nepal?
According to the statutory requirements, employers are not obligated to pay a 13th salary.
Labor rules
Probation period
The maximum probation period in Nepal is 6 months.
Notice period
The standard notice period in Nepal is 1 month, for employees with service of at least 1 year.
Severance period
The statutory severance pay in Nepal should equal the employee’s 30-day salary.
Working hours
The standard workweek is 8 hours per day, 6 days per week – from Sunday to Friday. Saturday is typically a rest day in Nepal.
Leave and benefits
Public holidays
Nepal celebrates a variety of public holidays, including regional and religious holidays:
- Prithvi Jayanti
- Maghe Sankranti
- Martyrs’ Day
- Sonam Losar
- Prajatantra Diwas
- Maha Shivaratri
- Ghyalpo Losar
- International Women’s Day
- Ram Navami
- Nepali New Year
- Loktantra Diwas
- Labour Day
- Ramjan Edul Fikra
- Buddha Jayanti
- Ganatantra Diwas
- Edul Aajaha
- Raksha Bandhan
- Gaura Parba
- Shree Krishna Janmashtami
- Hartalika Teej
- Rishi Panchami
- Nijamati Sewa Diwas
- Constitution Day
- Ghatasthapana
- Fulpati
- Maha Ashtami
- Maha Navami
- Vijaya Dashami
- Ekadashi
- Dwadashi
- Kojagrat Purnima
- Laxmi Puja
- Govardhan Puja
- Bhai Tika
- Chhath Puja
- Udhauli Parva
- Tamu Losar
Sick leave
Employees in Nepal are entitled to a fully paid sick leave of 12 days per year.
Maternity leave & Paternity leave
Female employees are entitled to a maternity leave of 98 days, of which 60 are fully paid. Male employees in Nepal are entitled to 15 days of fully paid paternity leave.
Other leave
Bereavement leave
Employees with over 1 year of service in a specific establishment are entitled to 13 days of fully paid bereavement leave.
What are the minimum vacation days?
Nepali employees are entitled to 1 day of paid annual leave for every 20 days of service or 18 days per year.
Insurance
Health security & private insurance
Anyone who has worked for an employer for at least three months within the previous fifteen months is entitled to free medical and dental care through the Social Security Administration.
*Native Teams can support you in finding the best private insurance in the country. Contact us, and we will send a comparison of insurance packages and prices.*
Visa
Relocation and work permits
Native Teams will apply for your work visa in the nation on your behalf and serve as your Employer of Record. All the required documents can be uploaded using our app. Until you have your work and residency visa, Native Teams will support you by providing you with frequent information on the progress.
How long is the visa/work permit process?
2 to 4 weeks depending on the authorities and provided documents.
Which documents do you need?
To apply for a visa/work permit in Nepal, upload the documents from our onboarding list (relocation to log in/pricing).
Why use Native Teams for hiring in Nepal?
Native Teams lets you employ team members ‘like a local’ meaning you get all the benefits of a global team, wherever you are based. Here are the reasons why you should use Native Teams for hiring:
- No paperwork: We will handle all the necessary paperwork for you.
- Save on taxes: We help you handle your taxes.
- No company set up: You can expand your business using our company entitles.
- Online onboarding: We’re here to ensure your onboarding process is trouble-free.
- No accounting: We will handle all of your accounting needs, including invoicing, payroll, and more.
- Increase your profit: We assist you in growing your business and maximizing your profits.
- Compliance expertise: we can assist your company in navigating the regulatory environments and ensure you meet all relevant requirements.
- Local support: We can assist you in understanding and complying with the relevant local laws.
