Stipend:
- What it’s for: A stipend is like a payment given to people for doing certain short-term activities, like internships, research, or projects.
- How it’s paid: Stipends are usually a fixed amount of money given regularly, but they might not depend on how much work you do. They’re often meant to help cover your costs during a specific program or project.
- Taxes: Stipends might be treated differently for taxes depending on the rules where you live. They could be considered as income, but sometimes they’re not taxed the same way as regular pay.
Salary:
- What it’s for: A salary is the money you get paid for having a regular job. It’s what you earn for working for a company or organization over a longer period.
- How it’s paid: Salaries are usually set amounts of money you get paid regularly, like every month or every two weeks. The amount can depend on things like your job, how much experience you have, and what’s common in your field.
- Taxes: Salaries are usually taxed, which means some money is taken out for taxes before you get paid. You usually get a form that shows how much you made and how much tax was taken out at the end of the year.
Taxation in Nepal:
- Income Tax: Just like in many countries, when you earn money from a job or other sources in Nepal, you might need to pay income tax. This tax helps the government provide public services like roads, schools, and hospitals.
- Types of Income: In Nepal, there are different types of income that can be taxed. This includes money you earn from your job (salary), profits from a business you run, and even the interest you earn from your savings in a bank.
- Tax Slabs: Nepal has different tax rates based on how much you earn. This means that if you earn more money, you might have to pay a higher percentage of your income as tax. The more you earn, the higher the percentage might be.
- Tax Deductions: Some expenses or investments might be deducted from your total income before calculating taxes. This could include things like contributions to a pension fund or certain types of investments.
- Filing Taxes: In Nepal, if you earn above a certain threshold, you need to file a tax return. This is a document where you tell the government about your income, deductions, and calculate how much tax you owe.
- Tax Withholding: If you work for a company, they might deduct a portion of your salary as tax before you get paid. This is called tax withholding. They will give you a statement at the end of the year that shows how much tax they deducted.
- Tax Year: The tax year in Nepal usually starts from mid-July and ends in mid-July of the following year. During this time, you gather all your financial information and file your taxes.
- Penalties: If you don’t pay your taxes on time or if you give false information, there could be penalties or fines.
