Individual Income Tax Return Filing in Bangladesh

Filing an individual income tax return means submitting an annual statement of income, in the prescribed form, to the Deputy Commissioner of Taxes (DCT) of the relevant taxpayer’s circle within the National Board of Revenue (NBR).

Who must file a return?

In certain circumstances, an individual taxpayer must obtain a TIN certificate and file a return with the DCT. An individual is required to file where, during the income year, total income exceeds the maximum limit that is not chargeable to tax under the Income Tax Ordinance 1984, or where the person was assessed to tax in any one of the three preceding years.

A person who resides within the limits of a city corporation, a paurashava, a divisional headquarters or a district headquarters must also file if, at any time during the relevant income year, they meet any of the following conditions:

• Owns a motor vehicle
• Is a member of a club registered under the VAT Act 1991
• Has a basic salary exceeding Tk. 16,000 at any time during the year (in the case of a government or corporation employee)
• Operates a business or profession with a trade licence from a city corporation or paurashava and runs a bank account
• Is registered with a recognised professional body — for example as a chartered accountant, cost and management accountant, doctor, dentist, lawyer, income tax practitioner, engineer, architect or surveyor, or any similar profession
• Is a member of a chamber of commerce and industry or a trade association
• Is a partner in a partnership business
• Is a shareholder director of a company
• Holds office in a paurashava or city corporation, or is a Member of Parliament
• Participates in a tender floated by the government, a semi-government or autonomous body, or a local authority
• Is a non-governmental organisation registered with the NGO Affairs Bureau

Deadline and supporting documents

An individual must file the tax return by 30 November, together with all related supporting documents. Two procedures are available: the universal self-assessment procedure and the normal procedure. To use the universal self-assessment procedure, the taxpayer must hold a 12-digit Tax Identification Number (TIN). Each procedure has its own advantages and disadvantages.

Generally, an individual taxpayer files using form IT-11 GA, with a statement of assets and liabilities in form 10BB, accompanied by supporting documents such as bank statements, salary statements and the treasury challan for tax deducted at source. Where the individual has house property income, the house rent agreement and a copy of the rent deposit slip must be submitted. A business individual must submit an income statement and balance sheet.

A salaried person whose only income is salary may file using form IT-11 UMA, supported by a salary certificate, TIN, TDS documents and bank statements. A business or professional individual whose income does not exceed three lakh may file using form IT-11 CHA. Any taxpayer claiming an investment rebate should complete schedule 24D and attach the supporting documents with the return.

Penalties

An individual is deemed guilty of an offence if, without reasonable cause, they fail to furnish the return of income or file it late. The DCT may impose a penalty of 10% of the last assessed amount — but not less than Tk. 1,000 — plus Tk. 50 for each additional day of delay. Where the person was not assessed earlier, the DCT may impose a penalty of Tk. 5,000. In addition, a person who fails to file the return by 30 November must pay interest at 2% on the currently assessed income, even where an extension was applied for on reasonable grounds.

Collecting revenue from individuals is a legal right of the government, essential to the survival and development of the country. Every individual whose income exceeds the taxable limit, or who is otherwise required to file under the Income Tax Ordinance 1984, must submit a return and pay income tax by 30 November to avoid penalties and comply with the law.