INCOME TAX MANUAL PART- 1

1 GOVERNMENT OF THE PEOPLE'S REPUBLIC OF BANGLADESH NATIONAL BOARD OF REVENUE INCOME TAX MANUAL PART- 1 THE INCOME TAX ordinance , 1984 (XXXVI OF 1984) [As amended up to July, 2014] Published by- Deputy Director Bangladesh Forms & Publication, Dhaka Printed by- Deputy Director Bangladesh Government Press, Dhaka 2014 GOVERNMENT OF THE PEOPLE'S REPUBLIC OF BANGLADESH NATIONAL BOARD OF REVENUE Taxes Wing INCOME TAX MANUAL PART- 1 THE INCOME TAX ordinance , 1984 (XXXVI OF 1984) [As amended up to July, 2014] i CONTENTS Sections Page Long title 1 Preamble 1 CHAPTER 1 PRELIMINAY 1. Short title and commencement. 1 2. Definitions. 2 CHAPTER II ADMINISTRATION 3.

2 INCOME tax authorities. 20 4. Appointment of INCOME tax authorities. 21 4A. Delegation of powers. 22 5. Subordination and control of INCOME tax authorities. 22 6. Jurisdiction of INCOME tax authorities. 23 7. Exercise of jurisdiction by successor. 26 8. Officers, etc. to follow instructions of the Board. 26 9. Guidance to the Deputy Commissioner of Taxes, etc. 26 10. Exercise of assessment functions by the Inspecting Joint Commissioners and the Inspecting Additional Commissioners. 27 CHAPTER - III TAXES APPELLATE TRIBUNAL 11. Establishment of Appellate Tribunal. 28 12. Exercise of power of the Tribunal by Benches. 29 13. Decision of Bench. 29 14. Exercise of power by one member. 30 15. Regulation of Procedure.

3 30 CHAPTER IV CHARGE OF INCOME TAX 16. Charge of INCOME tax. 31 16A. Charge of surcharge. 31 16B. Charge of additional tax. 32 ii Section Page 16C. Charge of excess profit tax. 32 16CC. Omitted . 32 16 CCC. Charge of minimum tax. 32 16D. Omitted. 33 16E. Omitted. 33 17. Scope of the total INCOME . 33 18. INCOME deemed to accrue or arise in Bangladesh. 34 19. Un-explained investments, etc., deemed to be INCOME . 36 19A. Omitted. 43 19AA. Omitted. 43 19 AAA. Omitted. 43 19B. Omitted. 43 19BB. Omitted. 43 19 BBB. Omitted. 44 19 BBBB. Omitted. 44 19 BBBBB Special tax treatment in respect of investment in residential building and apartment.

4 44 19C. Special tax treatment in respect of investment in the purchase of bond under Bangladesh Infrastructure Finance Fund 46 19D. Omitted. 46 19E. Voluntary disclosure of INCOME . 46 CHAPTER V COMPUTATION OF INCOME 20. Heads of INCOME . 49 21. Salaries. 49 22. Interest on securities. 50 23. Deduction from interest on securities. 50 24. INCOME from house property. 51 25. Deductions from INCOME from house property. 51 iii Section Page 26. Agricultural INCOME . 53 27. Deductions from agricultural INCOME . 53 28. INCOME from business or profession. 56 29. Deduction from INCOME from business or profession.

5 58 30. Deduction not admissible in certain circumstances. 65 30A. Provision for disallowance. 67 31. Capital gains. 67 32. Computation of capital gains. 68 33. INCOME from other sources. 72 34. Deductions from INCOME from other sources. 72 35. Method of accounting. 73 36. Allocation of INCOME from royalties, literary works, etc. 74 37. Set off of losses. 75 38. Carry forward of business losses. 76 39. Carry forward of loss in speculation business. 76 40. Carry forward of loss under the head "Capital gains". 77 41. Carry forward of loss under the head "Agricultural INCOME " 77 42. Conditions and limitations of carry forward of loss, etc. 78 43. Computation of total INCOME 79 CHAPTER VI EXEMPTIONS AND ALLOWANCES 44. Exemption 81 45.

6 Exemption of INCOME of an industrial undertaking 82 46. Exemption of INCOME of a tourist industry 88 46A. Exemption from tax of newly established industrial undertakings, etc. in certain cases 93 46B. Exemption from tax of newly established industrial undertakings set-up between the period of July, 2011 to June, 2019, etc. in certain cases. 98 46C. Exemption from tax of newly established physical infrastructure facility set up between the period of July, 2011 and June, 2019, etc. in certain cases. 105 47. Exemption of INCOME of co-operative societies. 109 iv CHAPTER VII PAYMENT OF TAX BEFORE ASSESSMENT Section Page 48.

7 Deduction at source and advance payment of tax. 112 49. INCOME subject to deduction at source. 112 50. Deduction at source from salaries. 117 50A. Deduction at source from discount of the real value of Bangladesh Bank bills. 118 50B. Deduction of tax from payment of remuneration to Member of Parliament. 119 51. Deduction at source from interest on securities. 119 51A. Omitted. 120 52. Deduction from payment to contractors, etc. 120 52A. Deduction at source from fees for professional and technical services. 120 52AA. Deduction from the payment of certain services. 122 52 AAA Collection of tax from clearing and forwarding agents. 122 52B. Collection of tax from Cigarette manufacturers. 122 52C. Deduction at source from compensation against acquisition of property.

8 123 52D. Deduction at source from interest on saving instruments. 123 52E. Omitted . 124 52F. Collection of tax from brick manufacturers. 124 52G. Omitted. 124 52H. Omitted. 124 52I. Deduction from the commission of letter of credit. 124 52J. Omitted. 124 52JJ. Collection of tax from travel agent. 125 52K. Collection of tax by City Corporation or Paurashava at the time of renewal of trade license. 125 52L. Omitted. 125 52M. Collection of tax from freight forward agency commission 125 52N. Collection of tax on account of rental power. 125 52O. Collection of tax from a foreign technician serving in a diamond cutting industry. 126 52P. Deduction of tax for services from convention hall, conference centre, etc.

9 126 52Q. Deduction of tax from resident for any INCOME in connection with any service provided to any foreign person. 127 52R. Deduction of tax from receipts in respect of international phone call. 127 52S. Collection of tax from manufacturer of soft drink, etc. 127 v Section Page 52T. Deduction of tax from any payment in excess of premium paid on life insurance policy. 128 52U. Deduction from payment on account of local letter of credit. 128 52V. Deduction from payment by cellular mobile phone operator. 128 53. Collection of tax from importers. 129 53A. Deduction at source from house property. 129 53AA. Collection of tax from shipping business of a resident. 130 53B. Deduction of tax from INCOME derived on account of export of manpower.

10 131 53BB. Collection of tax from export of certain items. 131 53 BBB. Collection of tax from Member of Stock Exchange. 132 53 BBBB Collection of tax from export of any goods except certain items. 132 53C. Collection of tax on sale price of goods or property sold by public auction. 132 53CC. Deduction or collection of tax at source from courier business of a non-resident. 133 53D. Deduction from payment to actors, actress, producers, etc. 133 53DD. Omitted. 134 53 DDD Deduction of tax at source from export cash subsidy. 134 53E. Deduction or collection at source from commission, discount or fees. 134 53EE. Deduction of tax from commission or remuneration paid to agent of foreign buyer. 135 53F.