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.

Income-tax returns of individuals can be filed anytime during the tax year. Rebate and additional tax has been introduced for early and late filing of returns as outlined below.

For natural persons who are first time income-tax return filers, the due date to file the tax return is 30^th June following the end of the income year.

For natural persons who are residing abroad, the tax return will be filed within 90 days from the date of return to Bangladesh, if such person –

• Is on leave for higher education or on deputation or lien for employment and is residing outside Bangladesh, or,
• Is staying outside Bangladesh with a valid visa and permit for the purpose of earning money.

In case of failure to file the return within the above-mentioned time period, the tax return will be referred to as a ‘delayed return’. The additional tax for filing a delayed tax return on a suo-moto basis is 10% of the tax payable or BDT 5,000, whichever is higher. In case the tax return is filed after the expiry of time period mentioned in the notice for reassessment proceedings, the additional tax is 15% of the tax payable or BDT 10,000, whichever is higher.

The NBR has upgraded the e-Return System, 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.

The NBR has mandated that all individual taxpayers must file income tax returns exclusively through its e-filing portal (www.etaxnbr.gov.bd), effective 28 June 2026.

The mandatory e-filing requirement does not apply to (i) taxpayers aged 65 or above, (ii) taxpayers with special needs/ disabilities (with certificate), (iii) Bangladeshi taxpayers residing abroad, (iv) legal representatives filing for deceased taxpayers, and (v) foreign nationals working in Bangladesh. These groups may still choose to e-file voluntarily.

In case of individuals having income only from employment, financial assets and agricultural income, if a tax refund arises, an automated refund will be provided after the return processing is completed  within 120 days after the tax return has been filed.

In case the statement of assets and liabilities and living expenses are not furnished along with the tax return, the tax return will be considered as incomplete.

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 1 million. 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 NBR implements audit guidelines and selects tax returns for audit based on these guidelines, with final approval of the selected returns by the NBR. 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. If the response is satisfactory, the audit concludes with an acknowledgement. If the response is unsatisfactory, a tax assessment is made under sections 183 or 184. The process is designed to be streamlined to reduce completion time of audit, with a two-year time limit for the selection or approval of returns for audit (from the end of the year in which the return was filed) and one year for the conclusion of the audit (from the end of the year in which the audit was selected).

In case of a tax refund claimed in the return of income filed under the self-assessment scheme (except in the cases of income only from employment, financial assets and agricultural income), the said return will be automatically subject to scrutiny assessment.

Assessment of tax mandatory in case of delayed return and return filed after selection of audit.

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 one year 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.