Three different services get sold in Nepal under the word "payroll", and the search results mix them up:
- Payroll outsourcing. A bureau or accounting firm runs your payroll from data you send them each month.
- Payroll software. Your own staff run payroll in a system that does the calculations.
- An employer of record (EOR). A Nepali company legally employs people on behalf of a business that has no entity in Nepal.
They solve different problems. Picking the wrong one gets expensive months later, and the cost never appears on an invoice.
What outsourcing takes off your plate, and what it leaves
A payroll bureau takes over the calculation:
- gross to net
- the TDS projection
- SSF and CIT deductions
- payslips
- often the TDS deposit and the e-TDS filing
What it can't take is the information. Every month someone in your office still has to send attendance, approved leave, joiners, leavers, raises, advances and the bonus the director agreed in the corridor. The bureau calculates from what you send. If Shrawan's attendance is wrong when it leaves your office, the payslips will be wrong when they come back, now with a second party's turnaround time added.
The legal responsibility stays with you too. Section 87 of the Income Tax Act 2058 puts the duty to withhold tax on salary on the resident employer, and section 90 requires that tax to be deposited within 25 days after the month ends. A bureau can do the work, but the duty is still yours, so a bureau that files late is your late filing.
None of this makes outsourcing a bad choice. It means you are buying labour, not removing a responsibility.
When outsourcing is the right call
- Nobody inside the business can own payroll, even for a day a month, and you don't want to hire someone who can.
- Payroll is very small and very stable: a handful of staff on fixed salaries with no attendance-based deductions.
- You want an outside accountant's judgment on the hard calls each month: which allowances are taxable, how to treat a settlement.
The last one is the strongest reason. A good accountant is worth paying for judgment. Paying one to retype attendance into a spreadsheet is the expensive part.
When software is the right call
Software makes sense once someone internal already prepares the monthly data. At that point the bureau is redoing work your office has half done, and the data travels twice.
Software also keeps the records with you. Payslips, the salary history across raises, the TDS each person paid and the e-TDS sheets for every month stay in a system you control if a provider relationship ends. Our case studies cover what moving payroll history between systems involves.
For a sense of cost, EK ERP's published plans on 29 October 2026 were:
| Plan | Price per month | Employees included |
|---|---|---|
| Starter | NPR 500 | up to 8 |
| SMB | NPR 2,000 | up to 20 |
| Professional | NPR 10,000 | up to 50 |
| Enterprise | NPR 50,000 | up to 200 |
Annual billing is 10 months' price for 12. Compare these against a bureau's monthly quote for the same headcount, then add the hours your office already spends preparing the bureau's data. That number stays the same either way. Current prices are on the pricing page.
The hybrid most accountants end up with
Plenty of businesses keep their accounting firm and give the firm access to the payroll software:
- Your office maintains attendance, leave and employee changes as they happen.
- The accountant reviews the run before it goes, and handles the TDS and the judgment calls.
- You stop paying for data entry and keep paying for expertise.
EK ERP supports this with role-based access, so an outside accountant gets their own login with a role you set.
EOR is a different question entirely
If your business has no registered entity in Nepal and wants to hire here, neither a bureau nor software solves the problem. Someone has to be the legal employer. That is what an EOR does, and it is usually the first step for a foreign company, for example one in Australia, before deciding whether to open a Nepali entity.
EK ERP is not an EOR. It is software for businesses that employ people in Nepal directly. Once a company has its own entity and staff, it needs the payroll, attendance and TDS records that this article is about.
A quick way to decide
Ask one question: who in your office will collect attendance, leave and salary changes every month?
- Nobody, and nobody will: outsource.
- Someone already does it: use software, and keep the accountant for review.
- You have no entity in Nepal yet: talk to an EOR first.
If software is your answer, our buying guide covers what to check, and EK ERP payroll shows how a month's run works.
Frequently asked questions
Does outsourcing payroll transfer the tax responsibility in Nepal?
No. Section 87 of the Income Tax Act 2058 puts the duty to withhold tax on salary on the resident employer. A bureau can do the calculation and filing for you, but a late deposit is still the employer's.
What is an employer of record (EOR) in Nepal?
A Nepali company that legally employs staff on behalf of a business with no registered entity in Nepal. It is usually the first step for a foreign company hiring in Nepal.
Is EK ERP a payroll bureau or an EOR?
Neither. EK ERP is payroll, HR and accounting software for businesses that employ people in Nepal directly. Your staff run payroll in it.
How much does payroll software cost in Nepal?
EK ERP's published plans on 29 October 2026 ran from NPR 500 a month for up to 8 employees to NPR 50,000 a month for up to 200. Current prices are on ekerp.cloud/pricing.