Income tax is one of
the main sources of accumulation of revenue by the government. Tax paid by
individual tax payer or by corporate entity on the basis of taxable income to
the government exchequer at the end of an income year is income tax. However,
one will be obliged to pay income tax only after exceeding the specified amount
of his/her tax free total income.
On
the contrary, income tax return means submission of return of income in the
prescribed form to the Deputy Commissioner (DC) of Taxes by a person whose total
income during the income year exceeds the maximum amount of non-chargeable
income or the income of any other person in respect of which
he is assessable to tax under the Income Tax Ordinance (ITO), 1984. However,
there are some exceptions where a person is also liable to submit his/her
return of income albeit s/he doesn’t exceed the specified amount.
Any
non-resident Bangladeshi may file his return of income along with bank draft
equivalent to the tax liability to the nearest Bangladesh mission and the
mission will issue a receipt of such return with official seal and send the
return to the National Board of Revenue (NBR).
As per the
stipulation stated in the Finance Act, 2016 if an ordinary man earned more than
Tk 250,000 during the income year 2015-16 then he has to file his income return
along with the source(s) of income. Nevertheless, the limit of maximum non
taxable income will be Tk 300,000 for women and senior tax payers of 65 years
and above age, Tk 375,000 for physically challenged personnel and Tk 425,000
for gazette enlisted war wounded freedom fighters. However, the following
person also has to submit his/her income tax return though s/he did not earn
much than the highest limit, if s/he:
i) owns motor
car including jeep/micro-bus;
ii) holds
membership of a club registered under the VAT law;
iii) runs any
business or profession having trade licence and operates a bank account;
iv) has
registered with a recognised professional body as a doctor, dentist, lawyer,
chartered accountant, cost and management accountant, engineer, architect,
surveyor or any other similar profession;
v) has
registered with the national Board of revenue as income-tax practitioner;
vi) member of a
chamber of commerce and industries or a trade association;
vii) is a
candidate for an office of any paurashava,
city corporation, or a Member of Parliament;
viii) assessed
to tax for any of the three years immediately preceding the income year;
ix) is a member
of board of directors of a company or group of companies;
x) is
shareholder director or shareholder employee of a company;
xi) is a partner
of a firm;
xii) is an
employee of the government or any other governmental authority, corporation,
entity, unit or authority, corporation, entity or unit constituted under
existing law, order or document who receives Tk 16,000 as basic salary at any
time of the income year;
xiii)
participates in a tender floated by the Government, semi- Government,
autonomous body or a local authority. In addition, any registered company/Non-Government
Organisation (NGO) shall file a return of its income or the income of any other
person for whom the company/NGO is assessable to the authority.
The
tax rates during the assessment year 2016-17 for individual taxpayer other than
female, taxpayers of 65 years and above, differently able person and
gazetted war-wounded freedom fighter are as follows:
|
Total Income
|
Rate of Tax
|
Amount of Tax
|
|
For first Tk 220,000
|
0%
|
0
|
|
For next Tk 400,000
|
10%
|
40,000/-
|
|
For next Tk 500,000
|
15%
|
75,000/-
|
|
For next Tk 600,000
|
20%
|
120,000/-
|
|
For next Tk 3000,000
|
25%
|
750,000/-
|
|
Rest above Tk 250,000
|
30%
|
75,000/-
|
|
Total amount of income tax above
Tk 5000,000
|
1045,000/-
|
|
The tax rates
for female,
taxpayers of 65 years and above, differently able, retarded and gazetted
war-wounded freedom fighter are almost same after exceeding the maximum
tax free threshold. However, the minimum amount of income tax for the assessee who
lives in Dhaka or Chittagong city corporation area is Tk 5000, Tk 4000 for
other city corporations areas and Tk 3000 for other tax payers’.
Submission of income tax return
Each income taxpayer
is entitled to get income tax return form for free of cost from tax offices or
from the website of NBR i.e www.nbr-bd.org
although photocopy of that form is also acceptable. Basically, main income tax return
form is constituted by three pages while first page is for basic information of
the taxpayer, second page is for income and tax account and third page is for
verification and signature. However, additional schedule will be added on basis
of source of income of the taxpayer.
NBR launched
online tax calculator on www.nbrtaxcalculatorbd.org to make it easy for the assessees to
assess their taxes. In addition NBR introduces online tax submission
portal to facilitate tax payers. Now anyone can submit his/her return by log in
www.etaxnbr.gov.bd and can make their payment through www.nbrepayment.gov.bd. However, to
do this every assessee needs to get user ID and password for the first time from
concerned tax office.
Moreover, NBR
also launches spot assessment for small entrepreneurs and other professionals. Apart
from these, in recent few years NBR arranges income tax fair where taxpayers
can get e-TIN, assess his/her total amount income tax in that income year and
can submit the return to the fair directly. After assessing the amount of
income tax every assessee shall deposit the amount to the public exchequer
through treasury challan if the
amount not exceeding Tk 10,00 or through
pay order, bank draft or account payee cheque in case the amount exceeds more
than Tk 10,000 or through online and submit duly signed and verified return
form along with the necessary documents i.e. salary statement, bank statement,
bond or debenture, income statement, balance sheet, house rent contract deed
etc. to relevant tax circle.
However, if
anyone claims tax rebate on investment then s/he must include the particulars
in schedule 24D and attach it along with the tax return form. Nonetheless, the
assessee needs to show any tax deducted at source during the income year or tax
paid in advance to the income tax return. Additionally, an individual must
submit his/her personal, spouse’s and dependents’ gross wealth owned at the
last day of the income year, liability and expenditure statement if s/he has
total gross wealth of Tk more than 2000,000 or own a motor vehicle at the last
day of the income year or own any house property or apartment or invest in any
house property or apartment in any city corporation area.
Time limit to submit the return
Every
individual must submit his/her income tax return to the concerned Deputy Commissioner
(DC) of Taxes from 1 July to 30 November, 2016. Otherwise s/he will be complied
to pay 2% monthly delay interest even if s/he applied for time extension with
the DC of Taxes. However, company/NGO shall submit the income tax return, by
the fifteenth day of July next following the income year or where the fifteenth
day of July falls before the expiry of six months from the end of the income
year, before the expiry of such six months and in all other cases, by the
thirtieth day of September next following the income year. Nevertheless, the
last date for the submission of return may be extended by the DC of Taxes up to
six months with the approval of the Inspecting Joint Commissioner. Beside this,
the Government can also extend the time limit.
Punishment for infringing the rule
An assessee
will be guilty of an offence punishable with imprisonment for a term which may
extend to three years but shall not be less than three months or with fine or
with both, if s/he makes a statement in any verification, return or any other
document furnished under any provisions of the ITO, 1984 which is false or
knowingly and willfully aids, abets, assists, incites or includes another
person to make or deliver a false return, account, statement, certificate or
declaration or himself knowingly and willfully makes or delivers such false
return, account, statement, certificate or declaration on behalf of another person.
Furthermore, an
assessee will be culpable of an offence punishable with imprisonment for a term
which may extend to one year or with fine or with both, if s/he, without
reasonable cause fails to furnish the return of income in due time. Beside
this, the DC of Taxes will impose fine Tk 10% from the last assessed amount but
not less than Tk 1000 and also impose fine Tk 50 for each day late.
In addition, a
person will be guilty of an offence punishable with imprisonment which may
extend to five years but shall not be less than three months or with fine or
with both, if he conceals the particulars or deliberately furnishes inaccurate
particulars of his income. However, document submitted by the assessee is
confidential and if a public servant or any person assisting or engaged by any
person discloses any particulars/information in contravention of the provisions
of this law is guilty of an offence punishable with imprisonment for a term
which may extend to six months or with fine.
Concluding remarks
The existing
systems of accumulation of income tax are still weak, complex, time consuming
and yet to hassle free for the taxpayers. Additionally, there are some loopholes
in our whole tax management and administration and some taxpayers take this
chance to evade taxes. More digitalization of tax management can reduce hassle
of taxpayers. Due to these reasons as well as our culture and mentality, the
government is being failed to achieve its target and enlarge the area of value
added tax as well as small income group people. Consequently, all classes of
people are forced to pay taxes in a different way and it creates impact on the
price of our daily commodities. Hence every eligible tax payer should pay tax
accordingly to build the nation.
