Bangladesh

Taxable period

The income year in Bangladesh for an individual is 1 July to 30 June.

Tax returns

Individuals are required to file an income tax return in case of the following:

• The taxable income exceeds the tax-free threshold.
• Assessed for any year within the immediately preceding three years.
• Shareholder director or employee of a company, employee in any executive or managerial position, having exempted income or subject to reduced tax rate, partner of a firm, government employee, or any non-resident having a permanent establishment in Bangladesh, etc.
• Required to be registered as a taxpayer.
• Required to furnish Proof of Submission of Return under specified cases.

Individuals are required to file their tax returns within the due date, known as ‘specified date for filing the return’. The due date of filing the income tax return for an individual is the 30th day of November following the end of the income year. Individual taxpayers will have the opportunity to seek an extension of the due date for filing the return from the Commissioner of Taxes up to a maximum of 90 days.

In case of failure to file return by the specified date for filing the return, interest is payable at 2% per month on the difference between the tax assessed on the total income and tax already paid or deducted, for the period commencing from the first day immediately following the  due date or specific date to the date of filing return (where return is filed) or the date of regular assessment (where return is not filed).

The Board has upgraded the e-Return System for the tax year 2024/25, allowing individual taxpayers to file returns online starting from 9 September 2024. The system offers features such as online return preparation, tax payment, and instant proof of filing and requires a Tax Identification Number and a biometric-verified mobile number for registration.

Payment of tax

Final income tax payment will be made on or before the due date of filing of the income tax return.

Moreover, advance tax is required to be paid only if the total income of the last assessed income year is more than BDT 600,000. The taxpayer must pay advance tax during the FY on the basis of estimated income in four instalments: by 15 September (25% of the estimated annual tax liability), by 15 December (25% of the estimated annual tax liability), by 15 March (25% of the estimated annual tax liability), and by 15 June of the tax year (25% of the estimated annual tax liability).

Electronic tax payment is also possible through designated banks or mobile payment applications by generating an A-challan.

Tax audit process

The Board implements audit guidelines and selecting tax returns for audit based on these guidelines, with final approval of the selected returns by the Board. Once approved, the Deputy Commissioner of Taxes (DCT) issues notices to the taxpayers whose returns have been selected, followed by the issuance of an audit report and notice. Taxpayers are given the opportunity to submit a revised return, and if the response is satisfactory, the audit concludes with an acknowledgement. If the response is unsatisfactory, a tax assessment is made under section 183 or 184. The process is designed to be streamlined to reduce completion time of audit , with a two-year time limit for both the selection or approval of returns for audit (from the end of the year in which the return was filed) and the conclusion of the audit (from the end of the year in which the audit was selected).

Statute of limitations

The selection or approval for audit must be within two years from the end of the year in which the tax return was filed. The audit must be concluded within two years from the end of the year in which the selection for audit takes place.

Topics of focus for tax authorities

International taxation is an area witnessing increased attention from the tax authorities. Another area of increased focus of the tax authorities is measures to ensure tax compliance by the taxpayers and increase in the tax base of the country.

Moreover, the tax authorities are also focusing on the implementation of the following:

• Introduction of e-TDS system, under a central WHT unit with a specific number of WHT zones under the central unit.
• Establishing a modern and fully automated tax information unit.
• Mapping the salary mentioned in the work permit with the actual payout made to an individual.