1. Taxation-1 Institute of Chartered Accountants Bangladesh
Md. Shakhawat Hossain
Articled Student
Howladar Yunus & Co.

2. Introduction to Bangladesh income tax
Bangladesh Tax Structure
Sources of tax law and practice
Scope of Bangladesh Income Tax
Structure of IT Ordinance, 1984
Objectives and Importance of Income Tax
Role of Income Tax in Economic Development of Bangladesh
Some Definitions
The Concept of Income
Capital or Revenue
Tax and Income Tax
Different Rates of Tax
Liability to tax
Some significant issues of income tax

3. Bangladesh Tax Structure
Direct Tax: (income tax, gift tax, land development tax, non-judicial stamp, registration, immovable property tax, etc)
Indirect Tax: (customs duty, excise duty, motor vehicle tax, narcotics and liquor duty, VAT, SD, foreign travel tax, IT, electricity duty, advertisement tax, etc) taxes.

4. Sources of tax law and practice
Income Tax Ordinance, 1984
The Income Tax Rules, 1984.
The Value Added Tax Act, 1991.
Finance Act
Case law
NBR Publication (NBR makes available some forms, notifications, brochures, and guidelines of income tax, VAT and customs through its websites and other forms of communication for public at large.
There are many SROs and circulars on income tax and VAT published by NBR providing guideline for tax purpose.

5. Scope of Bangladesh Income Tax
The Income Tax Ordinance, 1984
Income Tax Rules, 1984
Finance Act
SRO (Statutory Regulatory Orders):
Income Tax Case Law

6. Structure of IT Ordinance, 1984
Chapter
Title
Sections I
Preliminary Administration
1-2 II
Administration
3-10
III
Taxes Appellate Tribunal
11-15 IV
Charge of Income Tax
16-19E V
Computation of Income
20-43 VI
Exemption and Allowances
44-47
VII
Payment of Tax before assessment
48-74
VIII
Return & Statement
75-80

7. Structure of IT Ordinance, 1984
Chapter
Title
Section IX
Assessment
81-94A X
Liability in Special Cases
95-103A XI
Special Provisions relating to avoidance of tax
XIA
Transfer Pricing
107A-107J
XII
Requirement of furnishing certain information
XIII
Registration of firms
111
XIV
Powers of Income Tax Authorities XV
Imposition of Penalty
XVI
Recovery of Tax

8. Structure of IT Ordinance, 1984
Chapter
Title
Section
XVII
Double Taxation Relief
XVIII
Refunds
XVIIIA
Settlement of Cases
152A-152E
XVIIIB
Alternate Dispute Resolution
152F-152S
XIX
Appeal and Reference XX
Protection of Information
163
XXI
Offences and Prosecution
XXII
Miscellaneous F
XXIII
Rules and Repeal

9. Structure of IT Ordinance, 1984
The First Schedule
Part A: Approved Superannuation Fund
Part B: Recognised Provident Funds
Part C: Approved Gratuity Fund
The Second Schedule
Rate of Income Tax in Certain Cases
Non Resident (maximum rate)
Capital Gain
Winnings

10. Structure of IT Ordinance, 1984
The Third Schedule
Computation of depreciation allowance
The fourth Schedule
Computation of The profits and gains of Insurance Business
The Fifth Schedule
Part A
Computation of the profit or gains from the Exploration and production of petroleum and the determination of the Tax thereon
Part B
Computation of Profits and gains from the exploration and extraction of Mineral deposits (other than oil and oil gas) in Bangladesh

11. Structure of IT Ordinance, 1984
The Sixth Schedule
Part A
Exclusions from Total Income
Part B
Exemptions and Allowances for Assesses Being Resident and Non-Resident Bangladesh
The Seventh Schedule
Computation of Relief from Income Tax by way of credit in respect of foreign tax

12. Objectives and Importance of Income Tax
Revenue collection
Re-distribution of income
Increase in savings
Increase in capital investment
Economic development

13. Role of Income Tax in Economic Development of Bangladesh
Tax Holiday Scheme
Investment allowance
Accelerated Depreciation Allowance
Tax incentives for Small & Cottage Industries
Tax incentives for encouraging savings
Tax exemptions in certain expenditures
Tax incentives for foreign investors
Allowance for scientific research
Tax incentives for remittance to Bangladesh

14. Some Definitions Agricultural income [U/S 2(1)]
Annual Value [U/S 2(3)]:
Appellate Joint Commissioner [U/S 2(4)]:
Assessee [U/S 2(7)]:
Assessment [U/S 2(8)]:
Assessment Year [U/S 2(9)]:
Business [U/S 2(14)]:
Capital asset [U/S 2(15)]:
Charitable Purpose [U/S 2(16)]:
Child [U/S 2(18)]:
Company [U/S 2(20)]:

15. Some Definitions Deputy Commissioner of Taxes [U/S 2(23)]:
Dividend [U/S 2(26)]:
Employer [U/S 2(27)]:
Employee [U/S 2(28)]:
Fair Market Value [U/S 2(30)]:
Fees for Technical Services [U/S 2(31)]:
Income [U/S 2(34)]:
Income Year [U/S 2(35)]:
Interest [U/S 2(38)]:
Market Value [U/S 2(40)]:

16. Some Definitions Non-resident [U/S 2(42)]: Perquisite [U/S 2(45)]:
Person [U/S 2(46)]:
Profits in lieu of salary [U/S 2(50)]:
Recognized Provident Fund [U/S 2(52)]:
Resident [U/S 2(55)]:
Royalty [U/S 2(56)]:
Tax [U/S 2(62)]:
Total income [U/S 2(65)]:
Transfer [U/S 2(66)]:
Year [U/S 2(69)]:

17. The Concept of Income
Income should be received in the form of money or money’s worth.
Income should be in the form of revenue nature.
It should arise from some definite source or a source with some sort of regularity.
It should be derived from a person other than the recipient.
Income tainted with illegality is also classified as taxable income under tax law.

18. Capital or Revenue
Income tax is levied on income and not on capital receipts.
While ascertaining the profits of a business or profession, the revenue expenditure and not the capital expenditure is deductible from the trading receipts.
Whether a particular expenditure is incurred solely to earn profit or whether it is a capital expenditure depends in each case on the nature of business, commercial practice, the nature of the expenditure and other relative circumstances. No rigid rules can be laid down in this connection.

19. Tax and Income Tax Income tax is a tax on income
tax" means the income tax payable under the Ordinance and includes any additional tax, excess profit tax, penalty, interest, fee or other charges leviable or payable under the Ordinance." Therefore, income tax is any tax, additional tax, excess profit tax, penalty, interest, fee or other charges leviable or payable on any income or deemed income under the Ordinance.

20. Different Rates of Tax
Tax Rates for Individual, Firms, Association of Persons (AOP), Hindu Undivided Family (HUF) and Artificial Juridical Person:
Small and cottage industries
Tax Rates for Companies
Publicly Traded Company:
Non-Publicly Traded Companies
Bank, Insurance and Financial Institutions
Cigarette manufacturing companies
Mobile Phone Operator Company

21. Different Rates of Tax Inter-Corporate Tax Rate (Tax Rate on Dividend)
Tax Rate for Non-Resident
Capital Gain Tax Rate (Paragraph 2 of the Second Schedule)
Tax Rate on Winning
Lesser Tax Rate for special industry

22. Liability to tax Individuals income from salary
income from interest on securities
income from house property
agricultural income
income from business or profession which he operates as a sole trader or as a member of a partnership firm
capital gains and
income from other sources
Value added tax (VAT) as the supplier of goods and services (if a sole trader) or as the final consumer of goods or services

23. Liability to tax Partnerships
Each partner is liable to tax on his share of income of the partnership in an income year, but not for tax on the shares of income of the other partners.
Tax Deducted at source
Value added tax (VAT) as the supplier of goods and services or as the final consumer of goods or services
Companies
Corporation tax (CT) on its income

24. Some significant issues of income tax
Income Year & Assessment Year
Accounting year ends on
Income year
Assessment year

25. Some significant issues of income tax
Exceptions to the rule of Assessment Year
Income of discontinued business
Persons leaving Bangladesh
Income of non-resident shipping companies

26. Some significant issues of income tax
Residential status of an assessee
An individual stays in Bangladesh for -
182 days or more of an income year?
Resident
Yes
90 days or more of an income year? No
365 days or more during 4 immediate preceding years?
Non-resident
Is the assessee is Bangladeshi citizen?
Non resident Bangladeshi (NRB)
Non resident Foreigner (NRF)

27. Some significant issues of income tax
Taxation implication of resident or non-resident
To determine the amount of total income
To determine minimum limit of taxable income
Tax rate
Income tax rebate
Tax liability

28. Thanks Howladar Yunus & Co. Md. Shakhawat Hossain Articled Student
Taxation & Legal Compliance Department