This course includes conceptual foundation, tax accounting, classification of taxpayers, taxation ofincome, heads and sources of income, income from employment, capital gain tax, income frominvestment, valuation of stocks and depreciation, business loss, income from business, totalassessable income, tax liability and tax payable, value added tax, rights and duties, tax collection andrealization, penal provision, review and appeal, tax auditing.

The objective of this course is to provide students with the knowledge of general principles andpractices of taxation in Nepal and develop in them the basic skills required to solve practicalproblems regarding income tax, vat and enable for preparing tax returns.

Unit 1: Conceptual Foundation   10 LHs
Meaning and objectives of tax; Types of tax: Direct tax and Indirect tax; Canons of taxation;Historical background of income taxation in Nepal; Tax laws: Constitution, Tax Act, Taxrule, Finance Act, Legal precedents established by court; Features of Income Tax Act, 2058;Meaning of basic terms used in income taxation.

Unit 2: Tax Accounting    3 LHs
Registration for Permanent Account Number (PAN); Concepts of tax accounting;Accounting methods for different tax payers; Cash basis of accounting and Accrual basis ofaccounting; Changing accounting methods.

Unit : 3 Classification of Assesses/Tax payers  6 LHs
Natural person and entities; Single, couple and family; Resident and non-resident; Specialprovisions for natural person; Entities and retirement savings.

Unit 4: Taxation of Income  6 LHs
Concepts of: Presumptive taxation, Turnover taxation, Personal (non-corporate) taxation,Corporate taxation; Provisions of presumptive taxation and Provisions of turnover taxation in Nepal.

Unit 5: Heads and Sources of Income  2 LHs
Sources: Employment, Business, Investment, Casual gain.

Unit 6: Income from Employment  16 LHs
Concept of employment, difference between employment and profession; Features ofemployment income, Incomes chargeable under income from employment, Nonchargeable employment incomes; Allowable reductions, exemptions and applicable tax rates; Tax liability and tax payable.

Unit 7: Capital Gain Tax 4 LHs
Concept of capital gain and capital gain tax; Computation of capital gain on disposal ofdepreciable assets, business assets, non-business chargeable assets; Provisions for adjustment
and carry-forward of capital loss, Applicable tax rates for individual and entities.

Unit 8: Income from Investment 10 LHs
Concept of investment income; Difference between investment and business; Chargeableand non-chargeable incomes from investment; Deductible expenses and nondeductible expenses; Assessable income from investment; Set-off and carry-forward of investmentlosses; Investment income from domestic sources and foreign sources; Tax liability andtax payable.

Unit 9: Valuation of Stocks, and Depreciation 10 LHs
Methods of stock valuation, Adjustments of over and under valuation of stocks; Calculationof cost of trading stocks; Assets pooling system of depreciation, Calculation of depreciationbasis and allowable depreciation; Provisions for unabsorbed pollution control cost, researchand development cost and repairs expenses; Provisions of additional depreciation allowance.

Unit 10: Business Loss  6 LHs
Concept of assessed business loss, Set-off of business loss, Carry forward of business loss.

Unit 11: Income from Business 20 LHs
Concept of business income; Concepts of capital and revenue incomes and expenses;Chargeable and non-chargeable incomes from business; Deductible and non-deductible expenses; Assessable income from business; Tax liability and tax payable.

Unit 12: Total Assessable Income 6 LHs
Concepts of total assessable income and taxable income; Allowable reductions: retirementcontribution, insurance premium, remote area allowance; Reductions of additional exemptionlimit for the persons having pension income and disabled individual, Reduction of foreignallowance, Reduction of donations

Unit 13: Tax Liability and Tax Payable  6 LHs
Statutory exemption limit; Progressive slab rates and flat rates; Tax concessions;Adjustments of advance tax; Tax deduction at source (TDS) and Tax credits; Tax payableand tax clearance.

Unit 14: Value Added Tax (VAT) 16 LHs
Concept, principles and types of Value Added Tax (VAT); Characteristics of Vat: Burdenshifting, multi- stage imposition, zero-rating, deletion of cascading effect, substitute of salestax; Evolution of VAT, Origin and evolution of VAT in Nepal; Methods of Vat: Addition,Subtraction, Tax credit; Accounting of VAT: purchase book, sales book and VAT book;Collection, realization and refund of VAT; Penalties, actions and appeal

Unit 15: Rights and Duties 5 LHs
Rights of tax Authorities: Government of Nepal, Inland Revenue Department (IRD),Director General (DG), Chief Tax Officer and other officers; Rights and duties of taxpayers.

Unit 16: Tax Collection and Realization 6 LHs
Concept of tax collection, realization, remission and refund; Methods of tax collection:installment, withholding (tax deduction at source, TDS), self-assessment, presumptivetax; Methods of tax realization, Provisions of refund and remission.

Unit 17: Penal Provision, Review and Appeal 8 LHs
Concept and differences of penalty and offence; Provisions relating to fees and interest,provisions relating to offences; Concept of administrative review and appeal;Administrative decisions eligible for review, procedure of filing objections for administrative review;Provisions relating to appeal to Revenue Tribunal.

Unit 18. Tax Auditing 10 LHs
Relationship between Taxation and Auditing; Concept, types and major functions ofauditing; Internal control: Internal auditing and internal check; Concept, scope andobjectives of tax auditing; Provisions of tax auditing in Income Tax Act, 2058 and ValueAdded Tax, Act,2052.