Section 87 : Withholding of tax by employer

1) When making a payment which has a source in Nepal and is to be included in computing the income derived by any employee or worker, each resident employer shall deduct (withhold) tax at the rate referred to in Schedule I.

2) The liability of an employer required to withhold tax pursuant to sub-section (1) shall not decrease or end by virtue of the following:-

a) In cases where the employer has the right or duty to deduct hold up or subtract any other amount from the said payment or

b) If the income earned by the employee or worker from employment cannot be subtracted pursuant to other laws in force.