Bangladesh

Corporate - Taxes on corporate income

Last reviewed - 03 January 2025

A resident company is taxed on its worldwide income. A non-resident company is taxed only on income that accrues, arises, or is received in Bangladesh, or that is deemed to accrue, arise, or be received in Bangladesh.

Assessment year (AY) is defined as the period starting from 1 July of a year after the end of any tax year or accounting year of the company.

For example:

For a tax year from 1 July 2022 to 30 June 2023, the AY will be from 1 July 2023 to 30 June 2024.
For a tax year from 1 January 2022 to 31 December 2022, the AY will be from 1 July 2023 to 30 June 2024.
For a tax year from 1 July 2023 to 30 June 2024, the AY will be from 1 July 2024 to 30 June 2025.
For a tax year from 1 January 2023 to 31 December 2023, the AY will be from 1 July 2024 to 30 June 2025.

A subsidiary or a branch of a foreign company may apply to the Board and seek approval for a different tax year in Bangladesh in alignment with its parent’s tax year.

The CIT rates applicable to a Bangladeshi company and a foreign company for AYs 2024/25 and 2025/26 are as follows:

Category of taxpayer	Applicable tax rate in case conditions are met (%) *	Applicable tax rate (%)
Publicly traded company that issues shares worth more than 10% of its paid-up capital through an initial public offering (IPO)	20.00	22.50
Publicly traded company that issues shares worth 10% or less than 10% of its paid-up capital through an IPO	22.50	25.00
Non-publicly traded company	25.00	27.50
One person company	20.00	22.50
Publicly traded bank, insurance, or financial institution (except merchant bank)	37.50	37.50
Non-publicly traded bank, insurance, or financial institution	40.00	40.00
Merchant bank	37.50	37.50
Company producing all types of tobacco items, including cigarette, bidi, chewing tobacco, and gul	45% + 2.5% (surcharge)	45% + 2.5% (surcharge)
Publicly traded mobile operator company	45.00	45.00
Non-publicly traded mobile operator company	45.00	45.00
Association of persons (AOP)	20.00	27.50
Fund, trust, and other taxable entities	25.00	27.50
Private university, private medical college, private dental college, private engineering college, or private college solely dedicated to imparting education on information and communication technology	15.00	15.00

* Conditions:

All receipts and income must be transacted through bank transfer.
All expenses and investments over 500,000 BDT individually (BDT 3.6 million if aggregated annually) must be made through bank transfer.

Minimum tax regime

A three-way comparative is required between regular tax on profits, WHT under certain sections, and tax on gross receipts, and the higher of the three is considered as the final tax liability for a taxpayer.

The tax on gross receipts is applicable to all companies and only to firms having gross receipts of over BDT 5 million and other persons having gross receipts of over BDT 30 million.

The rate of tax on gross receipts is as follows:

Class of taxpayer	Rate of minimum tax on the gross receipts (%)
Manufacturer of cigarettes, bidi, chewing tobacco, smokeless tobacco, or any other tobacco products	3.00
Carbonated or sweetened beverages	3.00
Mobile phone operator	2.00
Natural-person taxpayer other than manufacturer of cigarettes, bidi, chewing tobacco, smokeless tobacco, or any other tobacco products	0.25
Any other case	0.60

However, the rate of tax would be 0.10% of the gross receipts for an industrial undertaking engaged in the manufacturing of goods for the first three income years since the commencement of commercial production.

In a scenario where the taxpayer enjoys exemption from income or the income is taxable at a reduced rate of tax, the minimum tax would be calculated by applying the rates mentioned above as reduced in proportion to the tax exemption.

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