Payroll Cycleतलब चक्र
The payroll cycle is the repeating sequence a company runs each pay period: collect attendance and leave, calculate earnings and deductions, approve, pay, and file. In Nepal it runs on Bikram Sambat months and carries a statutory deadline at the end.
Also called: pay cycle, payroll run, salary cycle
Key facts
- Period
- Bikram Sambat monthShrawan through Ashad.
- SSF deposit
- Within 15 daysOf the month ending.
- TDS deposit
- Within 25 daysOf the month ending, with the return.
The six steps
- Cut off attendance and leave for the month, and settle any pending approvals.
- Calculate earnings, statutory contributions and TDS for each employee.
- Review and approve, ideally with a second pair of eyes on the exceptions rather than on every line.
- Generate the bank transfer file and release payment.
- Deposit the SSF or PF contribution within 15 days of month end.
- Deposit withheld tax and file the withholding return within 25 days of month end.
Where cycles usually break
Almost always at step one. Attendance that is still being corrected after the cut-off forces a recalculation, and a recalculation after approval means the bank file, the payslips and the return can all disagree with each other.
The fix is a hard cut-off with an exception process, rather than an informal cut-off that everybody works around.
Running on Nepali months
A cycle defined on Gregorian months will not line up with the statutory deadlines, which are counted from the end of the Bikram Sambat month. Running the cycle on Nepali months removes a reconciliation step every single period.
Payroll Cycle, answered
Salary payment dates are set by the employment contract, but the statutory deadlines are fixed: SSF or PF contributions within 15 days of month end, and withheld tax with its return within 25 days of month end.
On the Nepali month. Statutory deadlines are counted from the end of the Bikram Sambat month, so a Gregorian cycle adds a manual reconciliation to every period.
This page explains general practice in Nepal. It is not legal or tax advice, and statutory figures are revised from time to time. Check the current Act, rule or notice before acting on it.
Related terms
- Nepali Fiscal Yearआर्थिक वर्षNepal's fiscal year runs from the first of Shrawan to the last day of Ashad in the Bikram Sambat calendar, which is roughly mid-July to mid-July in the Gregorian calendar. Tax slabs, leave accrual, bonuses and annual returns all follow it.
- TDS (Tax Deducted at Source)स्रोतमा कर कट्टीTDS is income tax withheld by the employer from an employee's salary each month and deposited with the Inland Revenue Department on the employee's behalf. It is calculated on annual projected income and spread across the year, not charged month by month in isolation.
- Salary Bank Transfer FileA salary bank transfer file is the formatted list of employee accounts and amounts a company uploads to its bank to pay everyone in one instruction, instead of entering transfers one by one.
- Payslipतलब पर्चीA payslip is the statement an employer issues each pay period showing earnings, deductions and net pay. In Nepal it is the employee's proof of income and of the tax and contributions withheld on their behalf.
- Attendance RegularisationAttendance regularisation is the process for correcting an attendance record: a missed punch, a forgotten check-out, a day spent at a client site. The employee raises it, a manager approves it, and the corrected record carries an audit trail.
- eTDSइ-टीडीएसeTDS is the Inland Revenue Department's electronic format for withholding returns. It reports, employee by employee and against each personal PAN, how much tax the employer withheld and deposited for the period.
- HRMSAn HRMS, or human resource management system, is software that holds employee data and runs the workflows around it: payroll, attendance, leave, performance and the approvals that connect them.
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