Income tax in Bangladesh
November 18, 2016
INDIVIDUAL TAXATION
Residents are taxed on their worldwide income. Married couples are taxed separately.
The tax year or assessment year in Bangladesh is from 01 July of one year to June 30 of another year. The tax year 2015-2016 is from 01 July 2015 to 30 June 2016.The tax year 2016-2017 is from 01 July 2016 to 30 June 2017.
INCOME TAX
Taxable income is classified into the following "heads of income": (1) employment income, (2) income from profession and business, (3) agricultural income, (4) income from property, (4) capital gains, (5) interest on securities, and (6) income from other sources. Income tax is levied at progressive rates. The tax bands are adjusted annually.
Different tax bands apply, depending on the classification of the taxpayer. Taxpayers are classified into the following: male taxpayers, female taxpayers, taxpayers over 65 years of age, and retarded taxpayers.
INCOME TAX 2015-2016 FOR MALE TAXPAYERS |
|
| TAXABLE INCOME, BDT (US$) | TAX RATE |
| Up to 250,000 (US$3,205) | 0% |
| 250,000 - 650,000 (US$8,333) | 10% |
| 650,000 - 1,150,000 (US$14,744) | 15% |
| 1,150,000 - 1,750,000 (US$22,436) | 20% |
| 1,750,000 - 4,750,000 (US$60,897) | 25% |
| Over 4,750,000 (US$60,897) | 30% |
INCOME TAX 2014-2015 FOR FEMALE TAXPAYERS AND SENIOR TAXPAYERS |
|
| TAXABLE INCOME, BDT (US$) | TAX RATE |
| Up to 300,000 (US$3,846) | 0% |
| 300,000 - 700,000 (US$8,974) | 10% |
| 700,000 - 1,200,000 (US$15,385) | 15% |
| 1,200,000 - 1,800,000 (US$23,077) | 20% |
| 1,800,000 - 4,800,000 (US$61,539) | 25% |
| Over 4,800,000 (US$61,539) | 30% |
INCOME TAX 2014-2015 FOR PHYSICALLY CHALLENGED TAXPAYERS |
|
| TAXABLE INCOME, BDT (US$) | TAX RATE |
| Up to 375,000 (US$4,808) | 0% |
| 375,000 - 775,000 (US$9,936) | 10% |
| 770,000 - 1,275,000 (US$16,346) | 15% |
| 1,275,000 - 1,875,000 (US$24,038) | 20% |
| 1,875,000 - 4,875,000 (US$62,500) | 25% |
| Over 4,875,000 (US$62,500) | 30% |
INCOME TAX 2014-2015 FOR MALE TAXPAYERS |
|
| TAXABLE INCOME, BDT (US$) | TAX RATE |
| Up to 220,000 (US$2,821) | 0% |
| 220,000 - 520,000 (US$6,667) | 10% |
| 520,000 - 920,000 (US$11,795) | 15% |
| 920,000 - 1,420,000 (US$18,205) | 20% |
| 1,420,000 - 4,420,000 (US$56,667) | 25% |
| Over 4,420,000 (US$56,667) | 30% |
INCOME TAX 2014-2015 FOR FEMALE TAXPAYERS AND SENIOR TAXPAYERS |
|
| TAXABLE INCOME, BDT (US$) | TAX RATE |
| Up to 275,000 (US$3,526) | 0% |
| 275,000 - 575,000 (US$7,372) | 10% |
| 575,000 - 975,000 (US$12,500) | 15% |
| 975,000 - 1,475,000 (US$18,910) | 20% |
| 1,475,000 - 4,475,000 (US$57,372) | 25% |
| Over 4,475,000 (US$57,372) | 30% |
INCOME TAX 2014-2015 FOR PHYSICALLY CHALLENGED TAXPAYERS |
|
| TAXABLE INCOME, BDT (US$) | TAX RATE |
| Up to 350,000 (US$4,487) | 0% |
| 350,000 - 650,000 (US$8,327) | 10% |
| 650,000 - 1,050,000 (US$13,462) | 15% |
| 1,050,000 - 1,550,000 (US$19,872) | 20% |
| 1,550,000 - 4,550,000 (US$58,333) | 25% |
| Over 4, 550,000 (US$58,333) | 30% |
RENTAL INCOME
Rental income earned by residents is taxed at progressive income tax rates, up to 30%.
CAPITAL GAINS
Capital gains are considered as ordinary income and applicable tax rates vary according to the length of time the asset is held before it was sold. Taxable capital gains are calculated by deducting acquisition costs and related expenses from the sale proceeds.
Capital gains are generally taxed at progressive income tax rates, up to 30%. Properties held for more than five years prior to the sale may be subject to a special flat tax rate of 15%, if this method yields a lower tax liability.
PROPERTY TAXATION
Property Tax
Property tax is levied on all properties in Bangladesh. Property tax is administered and collected by the local land revenue office. Property tax rates vary by location and property classification.
CORPORATE TAXATION
INCOME TAX
Income and capital gains earned by companies are generally taxed at a flat rate of 35%. Applicable income tax rates actually vary depending on the classification of the company and the type of income or capital gains. Taxable income is computed by deducting income-generating expenses from the gross profits.