A. Update
The Finance Bill passed by the Parliament received assent of the Hon'ble President Mohammed Shahabuddin on June 30, 2024. Tax Slab for the assessment year of 2025-2026 (financial year 2024-25) has been updated below as per the latest Finance Act:
| Effective for the assessment year of 2025-2026 (Income year of 2024-2025) | |
|---|---|
| Income Slab (in Taka) | Rate |
| On first 350,000 (male) / 400,000 (female) | Nil |
| Next 100,000 | 5% |
| Next 400,000 | 10% |
| Next 500,000 | 15% |
| Next 500,000 | 20% |
| Next 2,000,000 | 25% |
| On Balance | 30% |
B. Statutory Compliance Release Date: June 30, 2024
C. Effective Date: July 01, 2024
Tax - Finance_Act
A. Update
The Minister of Finance, Mr. Abul Hassan Mahmood Ali, presented the National Budget for the year 2024-2025 last Thursday. A series of key measures have been proposed in the budget and will be gazetted in due course. Below are the relevant proposals having payroll impact:
1.Tax rates for Individual taxpayers:
The proposed changes in tax slabs will be effective from the assessment year 2024-25.
| Amount of Taxable Income | Rate | |
|---|---|---|
| Existing | Proposed | |
| First Tk. 350,000 or as applicable | First Tk. 350,000 or as applicable | Nil |
| Next Tk. 100,000 | Next Tk. 100,000 | 5% |
| Next Tk. 300,000 | Next Tk. 400,000 | 10% |
| Next Tk. 400,000 | Next Tk. 500,000 | 15% |
| Next Tk. 500,000 | Next Tk. 500,000 | 20% |
| On the balance | On the balance | 25% |
2. Deadline of Withholding tax return:
Deadline for withholding tax return has been proposed to increase to 25th of the following month instead of 15th of the following month.
3. Extension of Tax Day:
Proposed extension of Tax Day maximum for one month (upto December).
B. Statutory Compliance Release Date: June 06, 2024
C. Effective Date: AY 2024-25 (income year starting July 01, 2023)
A. Update
The Minister of Finance, Mr. AHM Mustafa Kamal has presented the National Budget (‘the budget’) for the year 2023-2024 on June 01, 2023. A series of key measures have been proposed in the budget and will be gazetted in due course. Below is an overview of the relevant proposals having payroll impact:
1. The tax-free income threshold limit and tax rate have been revised for individuals as follows:
a) Individual Taxpayer- Tax-free Income Threshold:
| Tax exempted income | Current 2022-23 | Proposed 2023-2024 |
|---|---|---|
| General taxpayer | Tk. 3 lakhs | Tk. 3 lakhs and 50 thousand |
| Women and Senior citizen above 65 years age | Tk. 3 lakhs and 50 thousand | Tk. 4 lakhs |
| Physically Challenged persons | Tk. 4 lakhs and 50 thousand | Tk. 4 lakhs and 75 thousand |
| War-wounded gazette freedom fighter | Tk. 4 lakhs and 75 thousand | Tk. 5 lakhs |
| Third gender taxpayers | Tk. 3 lakhs and 50 thousand | Tk. 4 lakhs and 75 thousand |
| The income tax-free threshold would be increased for parents or legal guardians of physically challenged child or dependent by Tk. 50 thousand for each child/ dependent. | ||
b) Individual taxpayer- Tax rate:
| Current Tax slabs 2022-23 | Current Tax rate 2022-23 | Proposed tax slab 2023-24 | Proposed Tax rate 2023-24 |
|---|---|---|---|
| First Tk. 300,000 or as applicable | Nil | First Tk. 350,000 or as applicable | Nil |
| Next Tk. 100,000 | 5% | Next Tk. 100,000 | 5% |
| Next Tk. 300,000 | 10% | Next Tk. 300,000 | 10% |
| Next Tk. 400,000 | 15% | Next Tk. 400,000 | 15% |
| Next Tk. 500,000 | 20% | Next Tk. 500,000 | 20% |
| On the balance | 25% | On the balance | 25% |
2. It is proposed in the budget to remove the following items for which tax rebate cannot be claimed while computing individual income tax:
- Valuation of Perquisite Allowance
- House Rent Allowance (received in cash)
- Rent Free Accommodation
- Conveyance Allowance (received in cash)
- Conveyance received for private use
- Free of Concessional passage (commonly known as LFA or LTA)
- Entertainment Allowance
- Medical Allowance
3. There is a new exemption proposed in the budget, where from the total taxable income, 1/3 rd of “income from salary” or BDT 450,000 whichever is lower, will be exempted.
4. The limits for the investment rebates have been proposed to amend as follows:
| Investments | Proposed Limit 2022-23 | Current limit 2023-24 |
|---|---|---|
| Purchasing of BSP | 500000 Tk | No limit |
| Deposit of pension scheme (DPS) | 120000 Tk | 60000 Tk |
| Mutual fund | 500000 Tk | No limit |
Also, the calculation for investment tax rebate on eligible tax investment has been proposed to revise as follows:
Tax rebate on investment will be lower of followings:
• 3% of taxable income, or
• 15% of actual Investment, or
• 1 million
5. Notional Income (non-cash benefits) for free accommodation and transport facility has been proposed to revise as follows:
a) Accommodation: Actual rental amount has been proposed to consider for tax computation. Currently tax computation for accommodation facilities is based on 25% of taxable income or actual rental amount whichever is lower.
b) Car facility: For cars with 2500CC, BDT 10,000 per month and for cars with above 2500CC, BDT 25,000 is proposed to consider in tax computation. Currently tax computation for car facilities is based on 5% of taxable income or BDT 60,000 whichever is higher.
B. Statutory Compliance Release Date: June 01, 2023
C. Effective Date: July 01, 2023
https://nbr.gov.bd/uploads/news-scroller/%E0%A7%A8%E0%A7%A6%E0%A7%A8%E0%A7%A9-%E0%A7%A8%E0%A7%A6%E0%A7%A8%E0%A7%AA_%E0%A6%85%E0%A6%B0%E0%A7%8D%E0%A6%A5%E0%A6%AC%E0%A6%9B%E0%A6%B0%E0%A7%87%E0%A6%B0_%E0%A6%AC%E0%A6%BE%E0%A6%9C%E0%A7%87%E0%A6%9F%E0%A7%87_%E0%A6%86%E0%A7%9F%E0%A6%95%E0%A6%B0_%E0%A6%AC%E0%A6%BF%E0%A6%B7%E0%A7%9F%E0%A6%95_%E0%A6%89%E0%A6%B2%E0%A7%8D%E0%A6%B2%E0%A7%87%E0%A6%96%E0%A6%AF%E0%A7%8B%E0%A6%97%E0%A7%8D%E0%A6%AF_%E0%A6%AA%E0%A6%B0%E0%A6%BF%E0%A6%AC%E0%A6%B0%E0%A7%8D%E0%A6%A4%E0%A6%A8%E0%A6%B8%E0%A6%AE%E0%A7%82%E0%A6%B92.pdf
https://nbr.gov.bd/uploads/budget/Budget_Speech_2023-24_English_Final_Press_(1).pdf
A. Update
On June 9, 2022, Mr. AHM Mustafa Kamal, the Finance Minister of Bangladesh presented the national budget for fiscal year (FY) 2022-2023 and proposed the below mentioned changes. The same is gazetted on June 29, 2022 and published on July 1, 2022.
Change in Rates of investment tax rebate:
As per the amendment, rate of investment and the tax rebate are subject to change for the current year. The details are as follows.
| Change category | Old | New |
|---|---|---|
| Investment limit on the taxable income of individual. | 25% | 20% |
| Tax rebate on investment | 10% | 15%* |
*Earlier 10% tax rebate was given on annual income above 1.5 million and was 15% for annual income below 1.5 million. Now the rate is 15% flat on the eligible amount.
Also, if an assessee fails to submit the return of income shall be entitled to 7.5% credit from the amount of tax payable on his total income.
B. Statutory Compliance Release Date: June 29, 2022
C. Effective Date: July 01, 2022
A. Update
The Bangladesh Finance Minister has proposed a change through the finance bill in the deduction from payment to a beneficiary of worker’s participation fund - At the time of payment to the beneficiary of the workers’ participation fund 5% (five percent) of tax deduction shall be applicable and the person who is responsible for such payment shall deduct that certain amount on the whole payment. However, such tax deduction shall not be applicable in following circumstances:
- a. The beneficiary does not have taxable income; and
- b. Amount of fund does not exceed taka 25,000.00 (Taka Twenty-Five Thousand) only.
These changes are subject to parliament approvals with or without modification to become an Act.
B. Statutory Compliance Release Date: June 03, 2021
C. Effective Date: July 01, 2021 (Passed)
A. Update
In the Budget session, the Bangladesh government has announced changes in the Income-Tax Act through the Finance Bill for 2020-2021. Following is the overview for the same.
i. Tax-free Income Ceiling for Resident Individuals rises to TK 3 lakh:
| Category | Tax Free Ceiling (TK) | |
|---|---|---|
| Current | Proposed | |
| General | 2,50,000 | 3,00,000 |
| Women & elderly aged above 65 years | 3,00,000 | 3,50,000 |
| Physically disabled people | 4,00,000 | 4,50,000 |
| Gazetted Freedom Fighters/ Injured Veterans | 4,25,000 | 4,75,000 |
| Parents or Guardians of specially-abled children | - | by 50,000 Taka |
| Income Slabs and Tax Rates | |
|---|---|
| Total Income | Tax Rate |
| On the first TK 3,00,000 | Nil |
| On next TK 1,00,000 | 5% |
| On next TK 3,00,000 | 10% |
| On next TK 4,00,000 | 15% |
| On next TK 5,00,000 | 20% |
| On the balance of total income | 25% |
ii. Surcharge on Net Wealth - Individual Tax Payer:
| Surcharge on Net Wealth - Individual Tax Payer | ||
|---|---|---|
| Wealth | Rate of Surcharge * on income tax | Minimum Surcharge/Tk. |
| <BDT. 10 crore->=BDT. 15 crore | 20% | 5000 |
| <BDT. 15 crore->=BDT. 20 crore | 25% | 5000 |
| <BDT. 20 crore | 30% | 5000 |
| <=BDT. 50 crore | 0.1% of Net Wealth or 30% of Income Tax, whichever is higher | 0 |
| Up to BDT. 3 crore | 0 | 0 |
| <BDT. 3 crore->= BDT. 5 crore or Owns 1 + Car or Investment in land greater than 8000 sq. ft. in any City Corporation area | 10% | 3000 |
| <BDT. 5 crore->=BDT. 10 crore | 15% | 3000 |
iii. Advance Tax for the owners of Private Motor Car
| Advanced Tax for a Car or a Jeep | |||
|---|---|---|---|
| Not exceeding 1500 CC 25,000 Taka |
Exceeding 1500 CC but not exceeding 2000 CC 50,000 Taka |
Exceeding 2000 CC but not exceeding 2500 CC 75,000 Taka |
A Micro Bus 30,000 Taka |
| Exceeding 2500 CC but not exceeding 3000 CC 1,25,000 Taka |
Exceeding 3000 CC but not exceeding 3500 CC 1,50,000 Taka |
Exceeding 3500 CC 2,00,000 Taka |
|
iv. Minimum Tax- Individual tax payer
| Resident of Dhaka North City Corporation Resident of Dhaka South City Corporation Resident of Chittagong City Corporation |
5,000 Taka |
|---|---|
| Resident of Other City Corporation Area | 4,000 Taka |
| Resident of Non-City Corporation Area | 3,000 Taka |
v. Tax rate – Others
Income of Non-residents (Except NRB) - 30%
The Finance Bill has been passed by the Bangladesh Parliament and shall be effective from 1st July 2020 and the retrospective effect of Tax rates shall be taken care by the employee at the time of filing their individual returns
