Presentation on major changes in
Income Tax Act 2023
Anil Salam Idris & Co
Chartered Accountants
Wednesday, July 12, 2023
AGENDA
Introductory speech
Key Highlights of Budget 2023
Changes in major definition
Changes in Income Tax- Personal
Changes in Income Tax- Corporates and others
Changes in TDS​
Q&A
Partner’s Introduction
Anil Salam Idris & Co
Chartered Accountants
Partners’ Details
Md. Abdus Salam FCA
Md. Anwar Hossain FCA
Md. Sarwar Hossain FCA
SM Tauhidul Islam FCA
Md. Kamruzzaman FCA
Senior & Founding
Partner
asischittagong@gmail.com
+8801622304103
Managing Partner
Partner
Partner
Partner
anwar@asico.com.bd
+8801552346379
sarwar@asico.com.bd
+8801730022146
Tauhidul@asico.com.bd
+8801679587915
zaman@asico.com.bd
+8801701226899
Anil Salam Idris & Co
Chartered Accountants
Key Highlights of
Budget
Highlights of National Budget FY 2023-2024 (1)
Budget- Sources of funds
20%
13%
The proposed budget for
the fiscal year (FY) 202324 is BDT 761,785 crore
(FY 2022-23: BDT 660,507
crore: 15.34 % growth).
57%
7%
3%
NBR Collected
Non-NBR Tax
Non Tax Receipts
Foreign Loan
Domestic Borrowing
430,000 20,000 50,000 261,785
NBR collected
Non-NBR Tax
Non Tax Receipts
Budget deficit
Last year revised NBR
Tax 370,000
Last Year non-NBR
Tax 18,000
Last Year Non- Tax
receipts 45,000
Last Year Budget
deficit 227,507
Anil Salam Idris & Co
Chartered Accountants
Highlights of National Budget FY 2023-2024 (2)
The National Board of Revenue (NBR) has set the revenue collection target
for fiscal year 2022-23 at Tk 3,70,000 crore and 2023-24 at Tk. 430,000
Income Tax
VAT
Custom Duty
Last
Year
1,22,000 crore
which is 33% of
total revenue
collection.
136,900 crore
which is 37%
of total revenue
collection.
111,000 crore
which is 30% of
total revenue
collection.
This
Year
153,260 crore
which is 36% of
total revenue
collection.
163,837 crore
which is 38%
of total revenue
collection.
112,903 crore
which is 26% of
total revenue
collection.
Anil Salam Idris & Co
Chartered Accountants
Highlights of National Budget FY 2023-2024 (3)
Proposed budget
compared with Last
year
780,000
760,000
740,000
720,000
700,000
680,000
660,000
640,000
620,000
600,000
Proposed budget
2022-2023
2023-2024
GDP Growth compared
with last year
Inflation compared with
Last year
8.00%
8.00%
7.00%
7.00%
6.00%
6.00%
5.00%
5.00%
4.00%
4.00%
3.00%
3.00%
2.00%
2.00%
1.00%
1.00%
0.00%
0.00%
GDP Growth
2022-2023
2023-2024
Inflation Rate
2022-2023
2023-2024
The estimated GDP growth rate is 7.5% and the inflation rate is projected to be
6% for FY 2023-24 (FY 2022-23: GDP growth 6.03% and inflation rate was 7.5%).
Anil Salam Idris & Co
Chartered Accountants
Tax Law
New
Income Tax Act 2023 has been approved at
Parliament on 18 June 2023
Earlier
New
Income Tax
Ordinance 1984
Income Tax
Act 2023
187 Sections
345 sections
Anil Salam Idris & Co
Chartered Accountants
Changes in Definition
Tax Day 2(23)
No
change
The day when tax return submission is due
Return
Other than company
Company
Person not submitted tax
return before at all
Natural person staying
outside
Earlier
Now
30 November
Same
15th day of seventh month after
end of Income Year or if 15th day
of seventh month if before 15th
September, it will be 15th
September
Same
30th June after end of Income
Year
Same
Within 90 days from the date of
arrival
Same
Anil Salam Idris & Co
Chartered Accountants
Resident 2(45)
Change
A person shall be considered resident for tax purpose
if, he or she
Assesse
Individual
Earlier
More than 182 days in a income
year or
90days in income year and 365
days in last four preceding years
Company
HUF, Firm, AOP
Trust, Fund, Artificial
Judicial Person
Now
Minimum 183 days or more
or
90days in income year and
365 days in last four preceding
years
Same
Management and Control of full
affairs in Bangladesh
Same
Same
Anil Salam Idris & Co
Chartered Accountants
Income from Employment
Change
Few items are excluded formally from the definition of Salary
Inclusion
• Income earned from employee share
schemes
• Any amount/ benefit received from
any previous/ future employer
Exclusion:
• Conveyance travelling and daily
allowance received and incurred
for the performance of official duty
• Any payment to employees
(excluding shareholder Director) for
medical expenditures for Heart,
Kidney, Eye, Liver, Cancer
Anil Salam Idris & Co
Chartered Accountants
Perquisites 2(55) and 32
Change
Perquisites shall mean any payments or benefits including
Incentives bonus by employers to employees except
Earlier
Now
• Basic salary, festival bonus, incentive • Basic salary, festival bonus, incentive
bonus, arrear salary, advance salary,
bonus, arrear salary, advance salary,
leave encashment or leave fare
leave encashment or leave fare
assistance and overtime,
assistance and overtime, and
• Recognized provident fund,
approved pension fund, approved
gratuity fund and approved
superannuation fund
• Recognized provident fund,
approved pension fund, approved
gratuity fund and approved
superannuation fund
Anil Salam Idris & Co
Chartered Accountants
Bank Transfer 2(72)
Change
Bank Transfer includes
Earlier
Now
• Transfer of money by crossed
• Transfer of money by crossed
cheque
cheque or
• Mobile financial services (MFS) or
• Mobile financial services (MFS)
• any other digital means approved by • Bangladesh Bank approved mode of
the Bangladesh Bank;
payment
• Govt payments through Challan
(Even cash deposit)
Anil Salam Idris & Co
Chartered Accountants
Securities 2(87)
New
Securities includes
Earlier
No specific definition was there
Now
a) Securities issued by Govt including Treasury
Bill, T-bill, Bond, Sanchayapatra, Debenture,
SUKUK, Shariah based securities or similar
instruments
b) Share, stock, instruments, bond, debenture,
derivatives, mutual fund, AIF issued through
mortgage, charge or hypothecation, Unit
fund, Sukuk or shariah based Instruments,
Warrant or right to buy.
Anil Salam Idris & Co
Chartered Accountants
Changes in Personal
Tax
Personal income: Individual/Firm tax rates
(1/3)
Tax Payer
For Bangladeshi
individuals,
resident
foreigners, and
firms
Income Slabs
New Slab
Tax Rate
Up to BDT. 300,000
Up to BDT. 350,000
-
Next BDT. 100,000
Next BDT. 100,000
5%
Next BDT. 300,000
Next BDT. 300,000
10%
Next BDT. 400,000
Next BDT. 400,000
15%
Next BDT. 500,000
Next BDT. 500,000
20%
On balance
On balance
25%
 Change
For non-resident foreigner, flat tax rate of 30%
Anil Salam Idris & Co
Chartered Accountants
Personal income: Individual/Firm tax rates
(2/3)
Tax Payer
General – Individuals & Firms
Women and senior citizens (65+)
Physically challenged persons
War-wounded gazetted freedom fighters
Persons of Third Gender
Earlier
New
Exempted Limit Exempted Limit
BDT 300,000
BDT 350,000
BDT 350,000
BDT 400,000
BDT 450,000
BDT 475,000
BDT 475,000
BDT 500,000
BDT 350,000
BDT 475,000
For parents or legal guardians of physically challenged persons, the Nil
Tax Limit would be increased by BDT 50,000.
Anil Salam Idris & Co
Chartered Accountants
Personal income: Individual/Firm tax rates
(3/3)
Description of Area of Taxpayer’s Residence
Existing Minimum New Minimum Tax
Tax (BDT)
(BDT)
Dhaka North City Corporation, Dhaka South City
Corporation and Chattogram City Corporation
5,000
5,000
Any other City Corporation
4,000
4,000
Any area other than City Corporation
3,000
3,000
Removed
Minimum tax shall be BDT 2,000 for those who are required to file
tax return under section 75 but total income of those persons are
not exceeded tax exempted income
Anil Salam Idris & Co
Chartered Accountants
Personal income: Changes in Tax exemption
Earlier
Tax exemptions of maximum Tk.
450,000 in different components like:
House rent allowance (up to 3 lac),
Conveyance (up to 30,000) &
Medical allowance (up to Tk.
120,000).
New
New
Tax exemption one-third
of Income or Tk.
450,000 whichever is
lower
Anil Salam Idris & Co
Chartered Accountants
Income earned as share schemes 34
Issues share to its employees or employees of its associated
company or issues share to a Trust to transferring to its
employees or employees of its associated company
Earlier
Not included in the law
specifically
What about
unlisted
shares
New
New
Shares received under employee
shares schemes
Income = FMV of share on date of
receipt-acquisition cost or
Income =Sale value- price paid for
right to acquire share
Anil Salam Idris & Co
Chartered Accountants
Determination of value of perquisites, allowances,
benefits (Sec 33)
Change
Accommodation facility provided to employees
Earlier
Rent free
Rental value of accommodation
accommodation or 25% of basic salary whichever
is lower
At
(Rental value of accommodation
Concessionary or 25% of basic salary whichever
rent
is lower) less rent actually paid
by employees
Now
Annual value of the
accommodation shall
considered as income.
Annual value less rent paid
by employees shall be
considered as income
Anil Salam Idris & Co
Chartered Accountants
Determination of value of perquisites, allowances,
benefits (Sec 33)
Change
Vehicle facility provided to employees
Earlier
Vehicle for
Private or
personal use
5% of basic Salary or Tk.
60,000 whichever is higher
shall be added with Income
Now
Tk.10,000 per month if the
vehicle is less than 2,500CC
Tk. 25,000 per month if the
vehicle is more than 2,500CC
shall be added with Income
Anil Salam Idris & Co
Chartered Accountants
Personal Income: Surcharge on Tax Liability
Earlier Net worth
No
Change
Tax Rate
Net worth (New)
 Change
-
Up to BDT 30m
Up to BDT 40m
More than BDT 30m but less than BDT 100m
or Or more than 1 car or House over 8,000
sq. ft.
More than BDT 40m but less than BDT 100m
or Or more than 1 car or House over 8,000
sq. ft.
 Change
10%
More than BDT 100m but less than BDT 200m
More than BDT 100m but less than BDT 200m
20%
More than BDT 200m but less than BDT 500m
More than BDT 200m but less than BDT 500m
30%
More than BDT 500m
More than BDT 500m
35%
10% surcharge on tax
payable
Minimum surcharge, irrespective of Net Worth, for owning
more than one motor vehicle or housing property in any of
the City Corporation Areas of more than 8000 Sq ft. in
dimension
2.5% surcharge on income
for cigarette and tobacco manufacturers
Anil Salam Idris & Co
Chartered Accountants
Personal Income: Carbon Surcharge
•
Conditions
•
Net worth
New Rate
Upto 1500CC or 75KW each motor car
25,000
Over 1500CC or 75KW motor car but not
over 2000CC or 100KW each motor car
50,000
Over 2000CC or 100KW motor car but not
over 2500CC or 125KW each motor car
75,000
Over 2500CC or 125KW motor car but not
over 3000CC or 150KW each motor car
150,000
Over 3000CC or 150KW motor car but not
over 3500CC or 175KW each motor car
200,000
Over 3500CC or 175KW motor car
350,000
In case of more than one vehicle, surcharge will be
exempted on the vehicle with the lowest applicable
surcharge
It will be collected at the time of registration or renewal of
fitness
•
•
New
Motor vehicle includes any vehicles except Bus, minibus,
Coater, Prime Mover, Truck, Lory, Tang Lory, Pick-up, Human
Holler, Auto Rickshaw and Motor Cycle
Carbon tax are not adjustable with other tax or surcharge nor
refundable
Anil Salam Idris & Co
Chartered Accountants
Personal income: Investments Part 3 (6th Sc)
Earlier
Sectors/Area
DPS
Govt securities
Unit/mutual fund
New
Now
Limit
60,000
Any amount
Any amount
New Limit
120,000
500,000
500,000
*Securities includes Sanchaypatra, Debenture etc
Anil Salam Idris & Co
Chartered Accountants
Personal income: Investment Rebate u/s 78
New
Earlier
15% rebate will be availed on
eligible amount.
20% of total taxable income or
Actual investment cost as per Para
15 and 16 of Sixth Schedule or Tk.
1 core whichever is lower will be
treated as Eligible Amount.
Now
3% of total taxable income or
15% of total investment cost
as per Part 3 of Sixth
Schedule or Tk. 10 Lakh
whichever is lower will be
treated as investment rebate
Anil Salam Idris & Co
Chartered Accountants
Travel Tax (1/2)
Change
Individuals travelling inside or outside Bangladesh will now be subjected
to travel tax
Travel Type
Tax (BDT)
North and South America, Europe, Africa, Australia, New Zealand,
China, Japan, Hong Kong, North Korea, Vietnam, Laos and Cambodia,
Taiwan by air
6,000
Any countries under SAARC by air
2,000
Any other countries by air
4,000
Inside Bangladesh by air
200
Any country by road
1,000
Any country by water
1,000
Anil Salam Idris & Co
Chartered Accountants
Travel Tax (2/2)
New
Exemption from travel tax:
• Children under the age of 12 years are proposed to be subject to travel tax at half the
standard rate.
Following individuals are proposed to be fully exempted:
• Children under the age of 5 years
• Individuals travelling to Saudi Arabia to perform the Holy Hajj.
• Individuals who are blind, cancer patient or disabled and requires a stretcher.
• UN workers and their family members.
• Diplomats residing in Bangladesh in diplomatic missions and their family members.
• Employees of World Bank, German Vocational Organization and Japan International
• Development Organization residing in Bangladesh and their family members.
• Flight crew members.
• Travelers in transit and without Bangladeshi VISA staying in Bangladesh for less than 72
hours.
• Employee of any airline who is a Bangladeshi citizen and travels outside the country for
reduced or waived plane fare.
Anil Salam Idris & Co
Chartered Accountants
Integration of Income U/S 31
New
1. Notwithstanding anything content in this act following income will be
included in individual’s total income- Namely
a. If an individual being a partner of a firm or a member of a private
association, his/her share on total income of that firm or association.
b) Income from Spouse/minor children, If
• The said spouse or minor child dependent on that individual; or
• The individual has reasonable control over such income; or
• He is willing to do similar mergers.
However, this provision shall not apply if the said spouse/minor child is
assessed separately.
Anil Salam Idris & Co
Chartered Accountants
Statement of Asset and Liabilities (167)
Change
Submission of Assets and Liabilities Statement:
Earlier
• Gross wealth is over Tk. 40lac
• Own any asset abroad at any time in
the income year
• Becomes shareholder director of a
company
Now
• Gross wealth is over Tk. 40lac
• Own any asset abroad at any time in
the income year
• Travel abroad personally other than
for medical or religious purpose in
the income year
• Becomes shareholder director of a
company
Anil Salam Idris & Co
Chartered Accountants
Life style statement (168)
Change
Statement of expenses relating to the life style:
Earlier
Now
• Total income exceeds Tk 4 lakh
• Owns a motor car in the income
year
• Having income from business
• Investment in a house property
or an apartment in the city
corporation area
• Total income exceeds Tk 5 lakh
• Owns a motor car in the income
year
• Having income from business
• Investment in a house property
or an apartment in the city
corporation area
Anil Salam Idris & Co
Chartered Accountants
Proof of submission of Return (264)
A person shall be required to furnish a proof of submission of return
Earlier
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Change
Now
applying for a loan exceeding Taka five lakh/ (Taka Twenty Lakh) from a bank or a financial institution;
becoming a director or a sponsor shareholder of a company;
obtaining or continuing an import registration certificate or export registration certificate;
obtaining or renewal of a trade license in the area of a city corporation or paurashava;
obtaining registration of co-operative society;
obtaining or renewal of license or enlistment as a surveyor of general insurance;
obtaining registration, by a resident, of the deed of transfer, baynanama or power of attorney or selling of a land, building or
an apartment situated within a city corporation or a paurashava of a district headquarter or cantonment board, where the
deed value exceeds Taka ten lakh;
obtaining or maintaining a credit card;
obtaining or continuing the membership of the professional body as a doctor, dentist, lawyer, chartered accountant, cost and
management accountant, engineer, architect or surveyor or any other similar profession;
obtaining and retaining a license as a Nikah Registrar under the Muslim Marriages and Divorces (Registration) Act. 1974 (LII
of 1974);
obtaining or continuing the membership of any trade or professional body;
obtaining or renewal of a drug license, a fire license, environment clearance certificate, BSTI licenses and clearance;
Anil Salam Idris & Co
Chartered Accountants
Proof of submission of Return (264)
A person shall be required to furnish a proof of submission of return
Earlier
Change
Now
13. obtaining or continuing commercial and industrial connection of gas in any area and obtaining or continuing residential connection of gas in
city corporation area;
14. obtaining or continuing a survey certificate of any water vessel including launch, steamer, fishing trawler, cargo, coaster and dumb barge etc.,
plying for hire;
15. obtaining the permission or the renewal of permission for the manufacture of bricks by Deputy Commissioner's office in a district or
Directorate of Environment, as the case may be;
16. obtaining the admission of a child or a dependent in an English medium school providing education under international curriculum or english
version of national curriculum, situated in any city corporation, district headquarter or paurashava;
17. obtaining or continuing the connection of electricity in a city corporation or cantonment board;
18. obtaining or continuing the agency or the distributorship of a company;
19. Obtaining or continuing a license for arms;
20. Opening a letter of credit for the purpose of import;
21. Opening postal savings accounts of Taka exceeding five lakhs;
22. Opening and continuing bank accounts of any sorts with credit balance exceeding Taka ten lakhs;
23. purchasing savings instruments (Sanchayapatra) of Taka exceeding five lakhs;
24. participating in any election in upazilla, paurashava, zilla parishad, city corporation or Jatiya Sangsad;
25. participating in a shared economic activities by providing motor vehicle, space, accommodation or any other assets.
26. receiving any payment which is an income of the payee classifiable under the head "Salaries" by any person employed in the management or
administrative function or in any supervisory position in the production function;
Anil Salam Idris & Co
Chartered Accountants
Proof of submission of Return (264)
A person shall be required to furnish a proof of submission of return
Earlier
Change
Now
27. receiving any payment which is an income of the payee classifiable under the head "Salaries" by an employee of the government or an
authority, corporation, body or units of the government formed by any law, order or instrument being in force, if the employee, at any time in
the income year, draws a basic salary of taka sixteen thousand or more;
28. receiving any commission, fee or other sum in relation to money transfer through mobile banking or other electronic means or in relation to
the recharge of mobile phone account;
29. receiving any payment by a resident from a company on account of any advisory or consultancy service, catering service, event management
service, supply of manpower or providing security service;
30. receiving any amount from the Government under the Monthly Payment Order (MPO) if the amount of payment exceeds taka sixteen
thousand per month;
31. registration or renewal of agency certificate of an insurance company;
32. registration, change of ownership or renewal of fitness of a motor vehicle of any types excluding two and three wheeler;
33. releasing overseas grants to a non-government organisation registered with NGO Affairs Bureau or to a Micro Credit Organisation having
licence with Micro Credit Regulatory Authority;
34. selling of any goods or services by any digital platforms to consumers in Bangladesh.
35. submitting application for the membership of a club registered
36. submitting tender documents by a resident for the purpose of supply of goods, execution of a contract or rendering a service;
37. submitting a bill of entry for import into or export from Bangladesh;
38. submitting plan for construction of building for the purpose of obtaining approval from Rajuk, CDA, KDA and RDA or other concerned
authority in any city corporation or paurashava;
Anil Salam Idris & Co
Chartered Accountants
e-TIN Cancellation (262)
Application for cancellation of registration of Taxpayer:
Earlier
• It was not formally
mentioned in the law
Before Cancelation, Tax
authority will make Sure:
• Tax payer does not have
any outstanding dues
• There is no pending
assessment against him
• There is no unresolved
by the tax dispute at
any forum
Change
Now
•
•
•
•
•
•
•
•
•
•
Who is not obligated to submit PSR and
is not defined as taxpayer u/s 2 (22)
having no taxable income for last 3 consecutive years
is not required to submit return u/s 166 (those who needs
to file tax return)
having taxable income nil in the future due to physical
incapacity or any other reasons.
Ceased to exist due to death ,dissolution or any such reason
Leaving Bangladesh permanently and won't be engaged in
any earning activities in Bangladesh
Obtained duplicate or wrong registration
Changing legal status
Showing any other legal reasons
Anil Salam Idris & Co
Chartered Accountants
Changes in Corporate
and Others Taxes
Corporate tax
No
Change
Allowable limit of perquisite
Earlier
Now
1m BDT
1m BDT
Anil Salam Idris & Co
Chartered Accountants
Deduction not admissible in certain
circumstances U/S 55
Change
Inadmissible
Expense
▪
▪
▪
▪
Royalty
License
Technical Service
Fee, Any other costs
incurred for the use of
intangibles
Earlier
For the first 3 years: 10%
of the net profit from
business of profession.
Now
10% of the net profit
from business of
profession.
For subsequent income
years: 8% of the of the
profit from business or
profession
Anil Salam Idris & Co
Chartered Accountants
Deduction not admissible in certain
Change
circumstances U/S 55
Inadmissible
Expense
Earlier
Now
Salary expenses
Maximum 20k can be paid in
cash
No cash payment. Full amount
will be disallowed
Any liabilities which is not clearly
and properly calculated
Allowed but added back if not
cleared within 3 years end of
1st assessment year
Disallowed
Fully allowed
Maximum 5% of disclosed profit
Was not mentioned in law
sometimes allowed
Fully disallowed
WPPF
Accounts not maintained as per law
and all expenditures with no proof
Anil Salam Idris & Co
Chartered Accountants
Deduction not admissible in certain
No
circumstances U/S 55
change
Inadmissible
Expense
Earlier
Now
Tax has not been deducted at source
Disallowed
Disallowed
Fails to obtain the eTIN
Failed to submit statement under
section 108A
Payment of salary, remuneration,
interest or commission to any partner
Disallowed
Disallowed
Disallowed
Disallowed
Disallowed
Disallowed
Anil Salam Idris & Co
Chartered Accountants
Deduction not admissible in certain
No
circumstances U/S 55
change
Inadmissible
Expense
Earlier
Now
Payment of brokerage or commission without
deduction of tax at source
Disallowed
Disallowed
Payment to employees’ provident fund or other
funds unless effective arrangement has been
made for deduction of tax at source
Disallowed
Disallowed
Expenditure on foreign travels of employees and
their dependents, spouse and minor children
(including step and adopted children) for
holidaying and recreation exceeding 3 months
basic salary or 3/4th of actual expenditure
whichever is less
Disallowed
Disallowed
Anil Salam Idris & Co
Chartered Accountants
Deduction not admissible in certain
No
circumstances U/S 55
change
Inadmissible
Expense
x.
Earlier
Now
Distribution of free sample exceeding the following limit [sec. 30(f)(iv) + Rule 65C]:
Assessed turnover
Up to Tk. 5 crore
Exceeding Tk. 5
crore, but up to Tk. 10
crore
Exceeding Tk. 10
crore
Pharmaceutic
al industry
2%
1%
% of turnover
Food, cosmetics and
toiletries
1%
0.5%
0.50%
0.25%
Other industry
0.50%
0.25%
0.10%
Anil Salam Idris & Co
Chartered Accountants
Deduction not admissible in certain
No
circumstances U/S 55
change
Inadmissible
Expense
Earlier
Now
xi. Entertainment expenditure exceeding the following limits [sec. 30(f)(i) + Rule 65]:
Assessed income
On 1st Tk. 10 lac
On the remaining income
Limit
4%
2%
Anil Salam Idris & Co
Chartered Accountants
Deduction limit for interest
New
Earlier
No such ceiling
was there
Now
Special ceiling for allowance of interest:
• Interest paid by a resident to an associated
enterprise will be allowed to the extent and
calculated having regards to arm’s length
Price (ALP)
• ALP is not applicable for the interest
expenses not exceeding TK 15 Lakh
Anil Salam Idris & Co
Chartered Accountants
Deduction not admissible in certain
Change
circumstances U/S 55
Inadmissible
Expense
any payment exceeding Taka five lakhs paid by
a person on account of purchase of raw
materials otherwise than by bank transfer
Incentive bonus exceeding 10% of disclosed net profit
Overseas traveling exceeding 0.50% of disclosed
Business turnover.
Any commission/discount paid by any company to its
shareholder director
Promotional Expenses on disclosed business
Turnover
Earlier
Now
5lac
5lac
10%
Removed
0.5%
0.5%
Disallowed
Disallowed
0.5%
0.5%
Anil Salam Idris & Co
Chartered Accountants
Deduction not admissible in certain
No
circumstances U/S 55
Change
Inadmissible
Expense
Earlier
Now
House rent payment any amount
Disallowed
Disallowed
Any other payment over 50k except salary,
payment raw, rent
Disallowed
Disallowed
Not mentioned
Disallowed
Not mentioned in section 30
Disallowed
Accounts not prepared as per IFRS
Not mentioned
Disallowed
Impairment loss
Not mentioned
Disallowed
Disallowed
Disallowed
Fail to submit tax return
Capital expenditure
Payment to unapproved funds
Anil Salam Idris & Co
Chartered Accountants
Corporate tax
New
Employment of Non-resident without approval from authority
Earlier
No penalty
Now
Penalty of 50% of Tax
Payable or 5lac Tk
whichever is higher
Anil Salam Idris & Co
Chartered Accountants
Corporate tax
No
change
Difference in actual value and declared price in import, export or
investment
Earlier
Now
Penalty shall be
Penalty shall be
50% tax
50% tax
on such difference on such difference
Anil Salam Idris & Co
Chartered Accountants
Undisclosed offshore assets
Change
Any cash or cash equivalents, bank deposits, bank notes, bank accounts,
convertible securities and financial instruments if repatriated to Bangladesh
through banking channel
Earlier
Now
7%, no question
as to the sources
Facility has been
withdrawn
Anil Salam Idris & Co
Chartered Accountants
Any offshore asset not disclosed in the return
Any person being a resident Bangladeshi is found to be the owner of any
offshore asset not disclosed in the return and the assessee offers no
explanation
Earlier
Now
Penalty equal to
Fair value of such
offshore
Penalty equal to
Fair value of such
offshore
No
change
Anil Salam Idris & Co
Chartered Accountants
Charge of tax on retained earnings, reserves, surplus
The total amount transferred to retained earnings or any fund, reserve or
surplus by a company and listed to any stock exchange exceeds 70% of the No
change
net income after tax, tax shall be payable,
Earlier
Now
10%
10%
Anil Salam Idris & Co
Chartered Accountants
Charge of tax on stock dividend
The amount of stock dividend declared or distributed exceeds the amount of
cash dividend declared or distributed or without declaration or distribution ofNo
change
any cash divided by a company and listed to any stock exchange,
Earlier
Now
10%
10%
Anil Salam Idris & Co
Chartered Accountants
Corporate tax: Tax Rates (1/2)
No
Change
Nature of companies/Assesse
Existing
Publicly traded company that issues shares worth more than 10 percent of its paid-up capital
20%/22.50%*
through Initial Public Offering (IPO)
Publicly traded company that issues shares worth ten percent or less than ten percent of its paid22.50%/25%*
up capital through IPO
Non-publicly traded company
27.50%/30%*
One Person Company (OPC)
22.50%/25%*
Publicly traded bank, insurance and financial institution (except merchant bank)
37.50%
Non-publicly traded bank, insurance and financial institution
40%
Merchant Bank
37.50%
Company producing all sorts of tobacco items including cigarette, bidi, chewing tobacco and gul 45% + 2.5% (Surcharge)
Publicly traded mobile operator company
40%
Non-publicly traded mobile operator company
45%
Association of persons (AOP)
27.50%
Artificial juridical person and other taxable entity
27.50%
Co-operative societies registered under Co-operative Societies Act, 2001
15%
Private University, Private medical college, Private dental college, Private engineering college or
15%
private college solely dedicated to imparting education on ICT
* Condition: All receipts and income must be transacted through bank transfer and every single transaction above
Tk. 5 lakhs and annual investment over Tk. 36 lakhs of expense and investment must be made through bank transfer
Anil Salam Idris & Co
Chartered Accountants
Corporate tax: Tax Rates (2/2)
Reduced Rate for certain bodies are withdrawn
WASA
City Development Authority (CDA)
Civil Aviation Authority
Bangladesh Water Development Board
Bangladesh Television & Radio
Bangladesh Land Port Authority
Bangladesh Electricity Development Board
RDA, KDA etc.
Change
Earlier
New
25%
30%
** These autonomous bodies and they need to pay corporate tax at regular rate from now on
Anil Salam Idris & Co
Chartered Accountants
Withdrawal of Exemptions
Income of ICB from Unit Funds & Mutual Funds and Income of Issuer from
Mutual Funds shall be taxable now. Return of unit-holders will be reduced
Earlier
Now
Exempted
Taxable at
regular rate
New
Anil Salam Idris & Co
Chartered Accountants
New areas of tax admissible expenses
Specific Expenses shall be considered as admissible expenses
New
Now
Earlier
It was not specifically
mentioned
•
•
•
•
•
•
Utility
Transportation
Discount & Commission
Advertisement
WPPF
Realized forex loss
Anil Salam Idris & Co
Chartered Accountants
Various Statements
Change
WHT Statements has been withdrawn and monthly statement submission
has been proposed
Earlier
New
Statements
Statement of Tax deducted & Collected u/r 18
Monthly
Statement of WHT tax u/s 75A (Monthly)
Yearly
Statement of Dividend Payment u/s 110
Yearly
Statement of Interest Payment u/s 109
Yearly
Statement of TDS from Salary u/s 108
Yearly
Statement of Salary Tax deducted u/r 21
Statement of WHT tax u/s 75A
Statement of
WHT Tax u/s on
monthly basis
Monthly
Half Yearly
Anil Salam Idris & Co
Chartered Accountants
Minimum Tax [ Sec 163-164]
Change
Changes in Minimum Tax on Gross Receipts:
Earlier
Tax Payer
Now
Old Tax rate
New Tax rate
1. Manufacturer of cigarettes, bidi, chewing tobacco,
smokeless tobacco or any other tobacco products
1%
3%
2. Mobile phone operator
2%
2%
3. Individual other than individual engaged (in mobile
phone operation or in the manufacturing of cigarettes, bidi,
chewing tobacco, smokeless tobacco or any other tobacco
products, or having gross receipts Tk.3 crore or more
0.25%
0.25%
4. Any other cases
0.6%
0.6%
5. Carbonated beverage
0.6%
5%
0.1% in 1st 3 years
0.1% in 1st 3 years
6. Industrial undertaking engaged in manufacturing of goods
Anil Salam Idris & Co
Chartered Accountants
Minimum Tax [ Sec 163-164]
Change
Deletion of list of Final Discharge of Tax Liabilities:
Earlier
TDS paid/
collected under
these
additional
heads will be
consider as
minimum tax
• Deduction at source from compensation
against acquisition of property
• Deduction at source from interest on
saving instruments
• Deduction at source from export cash
subsidy
• Deduction at source from interest on
saving deposit and fixed deposit
• Deduction of tax on transfer, etc., of
property
• Deduction of tax any sum paid by real
estate developer to land owner
Now
• Deduction from payment to WPPF [Sec
88]
• Deduction of tax from advertising bill of
media broadcasting [sec 92]
• Deduction of tax for rendering service
from convention hall, conference center,
etc. [Sec 110]
• Deduction of tax from freight forward
agency commission [Sec 113]
• Deduction of tax from dividends [Sec 117]
• Collection of tax from lease of property
[Sec128]
Anil Salam Idris & Co
Chartered Accountants
Set off & Carry forward [ Sec 70-71]
All the relevant sections from the ITO, 1984, HAS Been aggregated and the
provision have been simplified
Earlier
As per the ITO, 1984,
business loss was allowed to
be set off with any income
from any other heads, except
income from house property
Change
Now
Business loss will
only be set off with
business income
Anil Salam Idris & Co
Chartered Accountants
Changes in 3rd Schedule, Part-1 & Part- 2
Change
Earlier
Now
Particular
The ITO, 1984
The ITA, 2023
3rd Sch, Part-1, Para 2- Bar of cost value of motor vehicle
25 lac
30 lac
50%
20%
-
10%
3rd Sch, Part-1, Para 2- Bangladesh made software
Amortization
3rd Sch, Part-1, Para 2- Expenditure disallowed
considering capital expenses: Amortization
Anil Salam Idris & Co
Chartered Accountants
Amortization
New
Earlier
Now
Categories
Old Tax rate
New Tax rate
License fee
Pro-rata basis
Pro-rata basis
20%
20%
Not mentioned
10%
50% for Local
20% for Local
10% for foreign
10% for foreign
Not mentioned
10%
Preliminary expenses
Research and development cost
Computer software and application
Unapproved expenses- Capital nature
Anil Salam Idris & Co
Chartered Accountants
Penalty
Change
Now
Earlier
Ref
The ITA, 2023
ITO, 1984
• Penalty for failure to issue TDS certificate: Maximum tk. 5000/ or in case
continuing default , a further penalty of tk. 1000/ for per month.
Sec 266
• Penalty for failure to furnish information: Tk 50,000/ instead of tk. 25000/- .
Sec 124
• Penalty for concealment of income: (A+B)
Sec 272 A=15% of tax avoided.
B= 10% of tax avoided X year [15%]
Sec 128
• Penalty for non -compliance with notice:
Sec 270 Non compliance with the notice issued for process of return shall not exceed tax
payable.
Sec 126
Anil Salam Idris & Co
Chartered Accountants
Return after Tax Day & Delay Interest
New
Now
Earlier
Ref
The ITA, 2023
ITO, 1984
Sec 170
Obligation to submit return under self-assessment:
• Persons under compulsion to submit return as per section 166
• Normal return may be submitted by company or person leaving Bangladesh except
OPC, bank, insurance and Finance
• Normal return refers to return submitted for tax assessment u/s 183 (DCT computed)
or 184 (Best judgement)
Not Any
Sec 174
Sec 76
Computation of tax for Submission of return after Tax Day:
• Ga=Ka X (1+0.04X Kha), here delay interest 4% per month (2% per month)
• Ka= tax payable on Tax Day (Includes minimum tax, surcharge and simple interest, but
excludes penalty/other tax) +tax computed at regular rate on exempted income
(includes reduced rate?)
• Kha= Number of months not exceeding 24 after Tax Day
• Fraction of a month be considered as 1 month
Sec 44
Sec 73A
Anil Salam Idris & Co
Chartered Accountants
Mandatory Audit for Firm, AoP and Funds
Audit for Firm, AOP and Funds become mandatory having turnover
over 2 Crore
Earlier
Were not mandatory
Change
Now
Mandatory
Anil Salam Idris & Co
Chartered Accountants
Changes in TDS
Anil Salam Idris & Co
Chartered Accountants
TDS on Grossed-up amount
If the Contract or agreement are made without tax and payment made in full
contract value, the tax shall be deducted at source on Grossed-up amount
Earlier
It was not clearly
mentioned in ITO, 1984
Change
Now
New formula has been
introduced and formalized.
C=(100*A)/(100-B)
A= Payment excluding tax
B= Tax rate
C= base amount
Anil Salam Idris & Co
Chartered Accountants
New TDS (tax deduction at source)
Change
89
2.
3.
4.
5.
Payment to supplier of Tobacco Leaves in any form, Tobacco Products including
Cigarettes, Biri, Jorda, Gul
Earlier
3 to 7%
New
10%
Anil Salam Idris & Co
Chartered Accountants
New TDS (tax deduction at source)
Change
1.
89
3.
4.
5.
Payment to supplier of Extra High Voltage Power Cable 33KV to 500KV by local
manufacturers having own Vertical Continuous Vulcanization line
Earlier
3 to 7%
New
3%
Anil Salam Idris & Co
Chartered Accountants
New TDS (tax deduction at source)
Change
1.
2.
3.
4.
5.
Gold dores imported by Industrial IRC holder VAT compliant gold refinery
Earlier
5%
New
0%
Anil Salam Idris & Co
Chartered Accountants
New TDS (tax deduction at source)
Change
1.
2.
4.
3.
5.
TDS on Interest of Govt. Approved Foreign Loan, Interest payable by:
Govt or Local Authority
Industrial Undertaking in Bangladesh
Financial Institutions for the advancement of loans to Industrial Undertaking
Earlier
Exempted
New
20%/10%
Anil Salam Idris & Co
Chartered Accountants
New TDS (tax deduction at source)
Change
Sec-86
2.
3.
4.
5.
Deduction from payment to workers participation fund
Earlier
New
5%
10%
Anil Salam Idris & Co
Chartered Accountants
New TDS (tax deduction at source)
Change
1.
Sec-92
3.
4.
5.
Deduction of tax from advertising bill of media broadcasting
Earlier
New
4%
5%
Anil Salam Idris & Co
Chartered Accountants
New TDS (tax deduction at source)
Change
1.
2.
125.
5.
4.
Tax on Transfer of Property
Earlier
4% or 3lac
to 10.8lac whichever higher
New
8% or 6lac
to 20lac whichever higher
Anil Salam Idris & Co
Chartered Accountants
New TDS (tax deduction at source)
Change
1.
2.
3.
127
5.
Collection of tax from commission on Govt. stamp, court fees and
cartridge paper.
Earlier
0%
New
10%
Anil Salam Idris & Co
Chartered Accountants
New TDS (tax deduction at source)
Change
1.
2.
3.
5.
Rule 5
TDS from non-resident courier services
Earlier
20%
New
15%
Anil Salam Idris & Co
Chartered Accountants
Income Tax Return Preparer Rules, 2023
•
Eligibility
•
•
•
•
•
Workflows
•
•
•
Incentives
to the
return
preparers
Bangladeshi citizen who are not gov’t officials, having Bachelor
degree
Have knowledge on preparing and submitting individual tax return
Practical knowledge of computer and ICT
Pass the Tax Aptitude & Accounting Test (TAAT)
Have TIN and Proof of Submission of Return (PSR)
Exempted
from TAAT
Exam
On minimum tax
The next BDT 15,000
The next BDT 50,000
Remaining tax
•
•
•
•
NBR will appoint Facilitator (firm or company)
Preparer shall be enlisted with NBR directly or via the Facilitator
Facilitator shall maintain profile of the preparers, train and supervise
them
Upon obtaining consent from the taxpayer, return preparer shall submit
tax return of the taxpayers, handover a copy of return and PSR
Incentives based on the income tax
paid by the taxpayer under section 74
•
Scope of
works for
the preparer
Chartered Accountants
Cost & Management Accountants
Chartered Secretary
Lawyer registered under the Bar Council
ITP registered with the Taxes Bar
Association
Only preparing and submitting income tax
returns under section 75 of the Income Tax
Ordinance, 1984, and cannot act as a
representative of a taxpayer to appear
before any income tax authority or
appellate tribunal
% of incentives
1st, 2nd& 3rd year
4th & 5th year
10%
2%
1%
0.5%
5%
1%
0.5%
0.25%
Anil Salam Idris & Co
Chartered Accountants
New time line for ADR process
No
Change
Changes in period for completion of agreement for Alternate Dispute Resolution
Earlier
New
3 months
3 months
Anil Salam Idris & Co
Chartered Accountants
Changes in House
property income
Anil Salam Idris & Co
Chartered Accountants
Deductions from Income from house
property U/S 22
In respect of expenditure for repairs, collection of rent, water and sewerage, electricity and
all other expenditure related to maintenance and provision of basic services are follows;
Type of Assets
Allowable Deduction
(% of Total Rent)
Existing
Allowable Deduction
(% of Total Rent)
Proposed
Property used for (Commercial purpose)
30%
30%
Property used for (Residential purpose)
25%
25%
-
10%
Other Assets (If required)
New
Anil Salam Idris & Co
Chartered Accountants
Question &
Answer
Anil Salam Idris & Co
Chartered Accountants
THANK YOU
Contact us:
info@asico.com.bd
Anil Salam Idris & Co
Chartered Accountants
Disclaimer
The presentation has been prepared to provide information
on Budget 2023 only which may not be used as legal
reference. Any references / communication /
recommendation presented here does not warrant any
confirmation that this will be accepted by tax office.
Tax authority might have different view.
This disclaimer applies in all slides/papers/documents presented here.