SHA

Tax deduction and collection at source

Tax deduction and collection at source

In Bangladesh withholding taxes are usually termed as Tax deduction and collection at source. Under this system both private and public limited companies or any other organization specified by law are legally authorized and bound to withhold taxes at some point of making payment and deposit the same to the Government Exchequer. The taxpayer receives a certificate from the withholding authority and gets credits of tax against assessed tax on the basis of such certificate.

Heads of Income Subject to deduction or collection of income tax at source with specified rates of deduction:

  • Salaries

  • Discount on the real value of Bangladesh Bank Bills

  • Interest on securities

  • Supply of goods and execution of contracts and sub-contracts

  • Fees for Doctors

  • Royalty or technical know-how fee

  • Fees for professional or technical services

  • Catering service

  • Cleaning service

  • Collection and recovery agency

  • Contract or toll manufacturing

  • Credit rating agency

  • Event management

  • Indenting commission

  • Meeting fees, training fees or honorarium

  • Mobile network operator, technical support service provider or service delivery agents engaged in mobile banking operations

  • Motor garage or workshop

  • Printing service

  • Private container port or dockyard service

  • Private security service provider

  • Product processing charge

  • Shipping agency commission

  • Stevedoring/berth operation commission

  • Supply of manpower

  • Transport provider

  • C&F agency commission

  • Biri manufacturer

  • Cigarette manufacturers

  • Compensation against acquisition of property

  • Interest on saving instruments

  • Brick Manufacturer

  • Commission of letter of credit

  • Collection of tax from travel agent

  • Renewal of trade license by City Corporation or Paurashava

  • Freight forward agency commission

  • Rental Power Company

  • Foreign technician serving in diamond cutting

  • For services from convention hall, conference centre etc.

  • Service charges, remunerations, consulting fees, commissions remitted from abroad for services works done by persons living in Bangladesh

  • Deduction of tax from international gateway service iro phone call

  • Deduction of tax from manufacturer of soft drinks and mineral or bottled water

  • Deduction of tax from any payment in excess of premium paid on life insurance policy

  • Deduction from payment on account of purchase through local L/C

  • Deduction from payment of fees, revenue sharing etc. by cellular mobile phone operator

  • Import

  • House property

  • Shipping business of a resident

  • Export of manpower

  • (a) Export of knit-wear and woven garments, (b) terry towel, jute goods, frozen food, vegetables, leather goods, packed food

  • Member of Stock Exchanges

  • Export or any goods except knit- wear and woven garments, terry towel, jute goods , frozen food, vegetables, leather goods, packed food

  • Goods or property sold by public auction

  • Payment to actors and actresses or purchase of film drama, any kind of television or radio program

  • Deduction of tax at source from export cash subsidy

  • Commission, discount or fees

  • Deemed Commission, discount or fees

  • Commission or remuneration paid to agent of foreign buyer

  • Interest on saving deposits and fixed deposits etc.

  • Real estate or land development business

  • Insurance commission

  • Fees of surveyors of general insurance company

  • Transfer of property

  • Collection of Tax from lease of property

  • Interest on deposit of post office saving bank account

  • Rental value of vacant land or plant or machinery

  • Advertisement of newspaper or magazine or private television channel or private radio station or any web site or any person on account of advertisement or purchasing airtime of private television channel or radio station or such website.

  • Collection of tax from transfer of shares by the sponsor shareholders

  • Collection of tax from transfer of shares of any Stock Exchange

  • Deduction of tax from any sum paid by real estate developer to land owner

  • Dividends

  • Income from lottery

  • Income of non residents Accounting or tax consultancy

  • Advertisement

  • Advisory or consultancy service

  • Air transport or water transport

  • Architecture, interior design or landscape design

  • Motor vehicle presumptive tax

  • Cargo/ Launch presumptive tax