Tax Clearance Certificate

 

Every expatriate employed in Bangladesh is required to obtain a Tax Clearance
Certificate from the concerned Deputy Commissioner of Taxes. This certificate
is required to be produced as evidence of tax payment/exemption at the port
of departure from Bangladesh.
9.16.10 Tax Rebate on Investment
An assessee shall be entitled to a rebate from the amount of tax payable if
he/she invests during the income year in the following items e.g.
 life insurance premium
 contribution to approved Provident Fund (both by the employee and
employer)
 contribution to deposit pension scheme amounting to not exceeding Tk
60,000 sponsored by a scheduled bank or a financial institution
 donation to a national-level institution set up in memory of the liberation
war
 donation to a national-level institution set up in memory of the father of the
nation
 donation to Prime Minister’s Higher Education Fund
 donation to Aga Khan Development Network/Asiatic Society/CRP/Dhaka
Ahsania Mission Cancer Hospital/icddrb
 donation to Zakat Fund/charitable fund established by or under Zakat Fund
 any sum invested in Bangladesh Government Treasury Bond and
Sanchayapatra
 stocks and shares of listed companies, mutual funds, and debentures listed
with any stock exchange in Bangladesh

Tax Clearance Certificate

The allowable limit of investment tax rebate is as follows:
Total income Investment tax rebate
on eligible amount*
Up to Tk 1.5 million 15%
Over Tk 1.5 million 10%
*Eligible amount is the lowest of the following:
Actual investment; or
25% of total income; or
Tk. 1.5 core
9.16.11 Deemed income
Deemed income in tax context is defined as quasi income, which is Section 19
 House rent:
If rent-free accommodation is provided to the employee, the rental value or
25% of the basic salary, whichever is less, is included in income. If
accommodation is provided at a concessional rate, the actual payment by
the employee is excluded from the above. Tax-exempted house rent receivable in
cash is Tk 25,000 per month or 50% of the basic salary, whichever is lower.
 Conveyance allowance:
Tax-exempt conveyance allowance receivable in cash is a maximum of Tk
30,000 per annum. If the employer provides conveyance for personal or private
use, an amount equal to 5% of the employee’s basic salary or Tk 60,000,
whichever is higher, is added to total income.
 Loan:
Any amount of loan not exceeding Tk 500,000 received by any assessee not
being a company from any person, not being a banking company or financial
institution, without crossed cheque or bank transfer, shall be treated as income
under the head’s income from other sources if not paid back within three years.
 Gift:
Loan or gift received from any source by an individual exceeding Tk 500,000

without crossed cheque or bank transfer shall be treated as income under the
head’s income from other sources

 Medical expenses:
Where any amount is received or receivable by the employee by way of
hospitalization, medical expenses, or medical allowance, the amount, if any, so
receivable or received exceeds 10% of basic salary or Tk 120,000 annually,
whichever is less, shall be included in his income.
In the case of an employee is a person with a disability, the medical expenses
exceeding Tk 1,000,000 shall be included in his total income.
Other items of such deemed incomes are contained in section 19 of the Income
Tax Ordinance 1984.

Tax Clearance

 Unexplained investments: –
Special tax treatment in respect of investment in residential buildings and
apartment (Section 19BBBBB) Any sum invested by any person in the
construction/purchase of any residential building/apartment shall be deemed to
have been explained if tax is paid at the following rates:

Area Tax per square meter

Up to 200
square meter

More than 200
square meter

A. Gulshan Model Town, Banani, Baridhara,
Motijheel Commercial Area and Dilkusha
Commercial Area

Tk 4,000 Tk 5,000

B. Dhanmondi Residential Area, Defence Officers
Housing Society (DOHS), Mohakhali, Lalmatia
Housing Society, Uttara Model Town,
Bashundhara Residential Area, Dhaka
Cantonment, Kawran Bazar, Bijoynagar,
Segunbagicha and Nikunja of Dhaka and
Panchlaish, Khulshi, Agrabad, and Nasirabad of
Chattogram

Tk 3,000 Tk 3,500

Area Tax per square meter

Up to 120
square meter

Up to 200
square meter

More than 200
square meter

C. Any City Corporation other than
the area mentioned in A and B

Tk 800 Tk 1,000 Tk 1,500

above
D. Pourashava or any district
headquarters

Tk 300 Tk 500 Tk 700
E. another area Tk 200 Tk 300 Tk 500
The rates will be 20% higher if the assessee makes an investment in two or more
buildings/apartments or already has any building or apartment in any City
Corporation.
Furthermore, the rate of tax will be 100% higher if for the income:
a) notice issued before submission of the return for concealment or escaped
assessment;
b) notice issued before submission of return to furnish information; and
c) Proceeding initiated before submission of the return for any noncompliance or
providing false statements or false information.
However, the above will not be applicable rather under sections 164, 165 and
166 if the source of income is:
a) derived from any criminal activities; or
b) not derived from any legitimate source.
9.16.12 Imposition of tax on income of Chamber of Commerce and
industry, trade federation, or any such business organization
Any income derived from any source other than income from a business, and
interest income of government-approved chambers of commerce and industry,
trade federation, industry, trade cooperative, etc. shall not fall under the scope
of tax liability.