1.

Employment (Section 32 - 34):

Computation of taxable income from salary at a glance:

1 Basic salary Full

2 Dearness allowance Full
3 Bonus Full
4 Commission and fees Full
5 Advance salary Full
6 Arrear salary Full, provided that, it was not taxed in earlier years
7 Leave encashment Full
8 Approved Pension Nothing, since fully tax free
9 Approved Gratuity Amount exceeding Tk.2.5 crore
10 Annuity Full
11 Profit in lieu of salary Full
12 Profit in addition to salary Full
13 Education allowance for children Full
14 Employer’s contribution to RPF Full
15 Employer’s contribution to employee’s
life insurance policy Full

16 Entertainment allowance Full

17 Medical allowance Full
18 Traveling allowance Unspent amount.
19 Special allowance Nothing, if given and spent for official purpose.
20 House rent allowance Full
21 Rent free accommodation Annual value
22 Accommodation at concessional rate Difference between annual value and amount received from
employee
23 Conveyance allowance Full
24 Transport / conveyance facility Motor car up to 2,500 CC monthly 10,000;
if motor car exceed 2,500 CC monthly 25,000
25 Free tea, coffee or light beverage in office
Nothing
premises
26 Free dress, telephone, power, gas, water
Full
in office etc.
27 Servant allowance Full
28 Compensation Full
29 Allowance received as head of the
Fully tax free if it spent for office purpose.
department / Charge allowance.
30 Overtime Full
31 Residence telephone bills / utility bills /
club bills reimbursed Full

32 Employees share scheme (Fair market value less Acquisition cost)

33 Interest on recognized provident fund [Interest - 33% (Salary Income - Interest on RPF)]

32. Income from Employment.--

(1) Subject to the provisions of sub-section (2), income from employment shall include the
following incomes, namely:-
(a) any pecuniary receipts, salaries and benefits received or due from employment;
(b) income earned from employee share schemes;
(c) untaxed salary arrears; or
(d) any amount or benefit received from any past or future employer.
(2) Income from employment shall not include the following receipts, namely:-
(a) amounts received for medical expenses related to heart, kidney, eye, liver and
cancer operations of any such employee who is not a shareholder director; or
(b) conveyance allowances, traveling allowances and daily allowances received and
expended wholly and solely for the performance of the duties of the service.
Explanation.-For the purposes of this section,-
(a) "Salary" means sums of any nature received by an employee from employment and shall
(i) any salary, wages or remuneration;
(ii) any allowance, holiday allowance, holiday encashment, bonus, fee, commission,
overtime;
(iii) advance salary;
(iv) gratuities, annuities, pensions or supplements thereof;
(v) Perquisites;
(vi) receipt in lieu of salary or wages or receipt in addition to salary or wages;
(b) "Receipt in Lieu of Salary or Wages" or "Receipt in addition to Salary or Wages"
shall include;-
(i) any compensation, by whatever name, received on account of termination of
employment;
(ii) except the remainder other than the contribution of the employee to the provident fund
or any other fund;
(iii) the fair market value of sums or benefits received as a result of change in the terms of
the contract of employment;
(iv) the fair market value of sums or benefits received on joining the service or under any
other condition of the service;

(c) "Perquisite" means any payment or benefit, including incentive bonus, paid by the
employer to the employee, but shall not include the following payments, namely:-
(i) basic pay, arrears, advance salary, festival allowance, holiday allowance, leave
encashment and overtime;
(ii) contributions paid to recognized provident funds, approved pension funds,
approved provident funds and approved Superannuation funds;
(d) "Basic Salary" means the salary payable monthly or otherwise on the basis of which other
allowances and benefits are determined, but shall not include the following allowances or
benefits, namely:-
(i) all allowances, perquisites, annuities, bonuses and benefits; and
(ii) contributions made by the employer to various funds of the employee;
(e) "Employer" means the person who employs and pays the wages or the person who performs
the said work on behalf of the employer shall also be deemed to be the employer.
33. Monetary Value of Perquisites, Allowances and Benefits.-
The monetary value of perquisites, allowances and benefits other than perquisites, allowances and
benefits payable at monetary value shall be determined as per the table below, namely : -

SI. Perquisites, Allowances,

Fixed Price
No Benefits, etc.
1 2 3
(a) value of the accommodation if the rent of the
accommodation is fully paid by the employer or annual
value if the accommodation is provided by the employer;
1 Accommodation benefits
(b) the difference between the rent determined and the
rent paid under clause (a) in case of accommodation
obtained at a reduced rent.
(a) Taka 10 (ten) thousand per month in case of vehicles up
to 2500 cc;
2 Benefits per motor vehicle
(b) Taka 25 (twenty five) thousand per month in case of
such vehicles of more than 2500 cc.
Any other perquisites, Monetary value or fair market value of perquisites,
3
allowances or benefits allowances or benefits.

34. Determination of Income Derived from Employees Share Schemes.—

( 1) employee share scheme means any agreement or arrangement under which a company-
(a) any of its employees or any of its subsidiary companies may issue shares to
employees; or
(b) may issue shares to the trustee of a trust and thereafter the trustee may issue such
shares to any employee of the said company or any of its subsidiary companies in
accordance with the trust deed. ·
(2) If shares are received under an employee share scheme, the income shall be added to income
from employment in the year in which the shares are received, as per rule a-b , where-
a = Fair market value of the shares on the date of receipt,
b = Cost of acquiring shares.
(3) The cost of acquiring shares referred to in sub-section (2) shall mean the sum of the following
costs, namely:-
(a) if the employee has paid any price to acquire the shares;
(b) if the employee has paid any price for the right or opportunity to acquire shares.
(4) If the right or opportunity to acquire shares under the employee share scheme is sold or
transferred by the employee, the income shall be added to the income from employment in
accordance with rule a-b , where-
a = Sale or transfer price of right or opportunity to acquire shares,
b = Price paid for right or opportunity to acquire shares.

6th Schedule :
Part 1
( 1) the income of any intergovernmental organization or any international organization or any of
its employees exempted from income tax under any Act made by Parliament or any treaty signed
by the Government;
(2) Any income as under-
(a) Remuneration received from the Government concerned by virtue of their employment in such
capacity by an Ambassador, High Commissioner, Envoy, Minister, Charge the Affairs,
Commissioner, Councilor, Consul the Career, Secretary, Adviser or Attache of a foreign State, High
Commission, Legation or Commission of a foreign State;
(b) a trade commissioner or other government representative of a foreign country stationed in
Bangladesh who is not performing unpaid duties in that capacity receives such salary, if such
officer of equivalent rank employed for such purpose in the country concerned enjoys similar
exemption;
 (c) income received as salary by a member of the office staff of an employee referred to in clauses
(a) and (b), when such member is not a citizen of Bangladesh and is a citizen of the State
representing him or is a citizen of any other foreign State and is a member of the said office staff;
not engaged in any business or profession or employment in Bangladesh except for carrying out
activities as a member, and similar exemptions apply to officials and employees of the Government
of the People's Republic of Bangladesh working in such representative state;

(4) pension received by the taxpayer or due to the taxpayer from the Government Pension Fund;
(5) Income not more than taka 2 (two) crores and 50 (fifty) lakhs received by the taxpayer from
the Government Gratuity Fund;
(6) any recognized provident fund, approved superannuation fund, pension fund and approved
provident fund-
(a) any contribution received by the employee or employer; and
(b) the income distributed among the beneficiaries thereof which is chargeable to the said fund:
Provided that the amount received by the taxpayer as gratuity from any approved gratuity
fund shall not exceed taka 02 (two) crores and 50 (fifty) lakhs;
(7) the Provident Fund Act, 1925 (Act No. 19 of 1925) applicable to any such Provident
Fund arising or accruing or any income arising from the Provident Fund;
(8) any amount received under any scheme approved by the Government for the purpose on
voluntary retirement by any employee of Government bodies, local authorities, or autonomous or
semi-autonomous bodies and their controlled units or institutions;
(9) Any money received as interest or sum of money received as interest from Pensioners
Savings Certificate, in which case the total accumulated earned value/actual value/literal
value/purchase price of the invested money of the said certificate at the end of the relevant
income year is more than taka 5 (Five) lakh;

1(14) Reimbursement of expenses of an employee by an employer if -

(a) the said expenditure is wholly and necessarily incurred in the performance of the duties of the
employee; and
(b) it was most convenient for the employer to incur such expenditure through the said employee;

1 (27) One-third of the income calculated as "income from employment" or taka 4

(four) lakhs 50 (fifty) thousand whichever is less;

2nd Schedule , Part 3

5. Provisions relating to income and contributions to funds.-
(1) Contributions made by an employer to any recognized provident fund shall, subject to the
limits specified in this Act, be deducted from the income, profits and gains computed by the
assessee of his tax.
(2) Where any income is received from the fund by interest or otherwise, other than as part of the
subscription-
( a) a sum of money shall be exempted from payment of tax, if a < (b x 33%);
(b) An amount equal to a - ( b x 33%) shall be added to the income of the recipient, if
a > (b x 33%), When-
a = amount of money derived from the fund in the income year,
b = Salary income ( excluding said income) in the income year.
 2. Income from rent (section 35 -39):

Particulars
Reasonable Value: 720,000
Rental value
Add: TDS (If any) Higher of annual value and actual
Add: Owner's expenses paid by the tenant rent a l va lue
Less: Tenant' s expenses paid by the owner
Actual rental value 600,000
Annual Value

Add : Advance rent

Any receipts or sum other than rental value or advance rent
Less : Adjusted advance rent which received previous income year
Vacancy allowance
Annual Value after
adjustment
Less: Admissible expenses:
1. Repair & maintenance expenses
[Collection charge, sewerage bill, salary of [Admissible limit: Residential house: 25%,
guard, liftmen, caretaker etc.] Commercial house: 30% & Others 10%]

2. Land development tax Proportionate in case of Vacancy

3. Insurance Premium Proportionate in case of Vacancy
(deductable in equal 3 installments in
4. Interest payable on house building Loan
consecutive income years)
5. Annual tax (Municipal or local authority Proportionate in case of Vacancy
tax]
Total Income from
Rent

35. Definition.-For the purposes of this chapter,-

( l) "House Property" means-
(a) furniture, fixtures, fittings which are an integral part of the said house; and
(b) the land on which the house is situated, but shall not include any factory building;
(2) "Lease" means the grant of the right to use property for a specified period, whether or not owned, by
a scheduled bank, investment bank, development finance institution or mudaraba or leasing company to
any other person without relinquishing ownership or title; shall not include the payment of rent;
(3) "Property" means house property, land, furniture, fixtures, factory buildings, business premises,
machinery, personal vehicles and any other physical asset of capital nature, which is rentable.
36. Income from Rent.--

(1) From the total rental value of any property of a person, after deducting the total allowable expenses
mentioned in this Chapter, what the remaining shall be the rental income of that person from that property.

(2) If any part of the property of a person is engaged for the purpose of that person's own business and the
income derived therefrom is countable under the income from business of that person, this section shall not
apply for that part.
(3) Irrespective of the nature of the rent of any property, irrespective of the nature of trade, trade or
business, the income from rent shall be computed under the head of income.
(4) In cases where more than one person owns the property mentioned in sub-section (1 ), the income
received by any person from the rent of the said property shall be calculated as follows, namely :-

If the amount of a person's share in the At a rate proportionate to the share of

property is specified and certain ownership
 In the case of calculating the tax of any
person from the rent of the said
The amount of a person’s share in the
property, the said persons shall be
property is not specified
considered as an association of
individuals.

37. Calculation of Total Rent.-

The gross rental value of a property in any income year shall be calculated as per the following formula,
a = ( b + c + d ) - e - f , where-
a = Total rental value,
b = the amount of rent received from the said property, or the annual value of the property,
whichever is higher,
c = the amount in the nature of advance rent received from the said property in the said income
year, by whatever name it may be called,
d = any other sum or any benefit received from the said property in the said income year, which is
additional to the sum mentioned in 'b' or 'c',
e = any such advance, which was included in the total rental value on account of receipt in any
previous income year, but such advance has been adjusted by the lessee against the rent of the
relevant income year,
f = vacancy allowance:
Provided that the non-availability of rental income shall be intimated to the Deputy Commissioner
of Taxes by the 30th of every month.

38. Deductions from Income from Rent.-

The following expenses shall be deductible in computing rental income, namely:-
(a) the premium paid for any insurance against the risk of loss or destruction of any property;
(b) interest or profit paid on any capital loan taken from any financial institution for the
acquisition, construction, renovation, new construction or reconstruction of property;
(c) any tax fee or other annual charge paid on the property, which is not in the nature of a capital
charge;
(d) The sums mentioned in the table below for expenditure on repairs, rent collection, water and
sewerage, electricity, maintenance and various basic services, namely:-

Deductible Expenses
SI. Type of Property
(as percentage of total rental value)
1 2 3
House property used for
1 30% (thirty percent)
commercial purposes
House property used for
2 25% (twenty five percent)
non-commercial purposes
3 Other properties (if applicable) 10% (ten percent):

Provided that this exclusion shall not apply where the lessee pays the service charge for the expenses
mentioned in this clause in addition to the rent of the property;
(e) If any interest or profit has been paid to any financial institution on any capital loan used for
acquisition, construction, repair, reconstruction or reconstruction of the property during the pre-rental
period, such interest or profit shall be deductable in equal installments for a total of 3 (three)
consecutive income years from the relevant income year commencing with the commencement of the
rent;
(f) No interest or profit or any part thereof, if any, during the pre-rental period shall be deductable after the
period mentioned in clause (e).
39. Limitation of Approval of Expenditure.-
(1) In respect of any such expenditure to which tax is deductible at source, if the tax is not deducted or
collected at source, or if the tax deducted or collected is not duly deposited in favor of the Government
in accordance with the provisions of this Act, such expenditure shall not be allowable as
expenditure under this Chapter.
(2) In case of partial rent of the property, expenses shall be allowable at the rate proportionate against the
partial rent.
(3) Where a property is rented for part of the income year, the expenditure shall be admissible at the
rate proportionate to the period of rental.

109. Deduction of Tax at source from Rent.-

(1) Where a specified person-
(a) any house property;
(b) hotel or guest house;
(c) vacant premises or plant or machinery; or
(d) any reservoir other than a government reservoir,
In case of rent the said person shall deduct tax at the rate of 5% (five percent) on the rent payable
while paying the rent of the said property.
(2) In cases where it is found after assessment of tax for the relevant year that no tax is payable by the
owner of the house property or the amount of tax paid is more than the tax payable, in that case the
amount deducted shall be refunded at the rate stated below-
(a) if no tax is payable, the whole portion; or
(b) if the amount of tax deducted exceeds the amount of tax payable, whichever is excess.
(3) Where, on an application made in this behalf, the Deputy Commissioner of Taxes issues a certificate in
good faith in the prescribed form to the effect that the owner of the house property has no assessable
income for the said year or is exempt from income-tax subject to the provisions of this Act, provided under
sub-section (1) the tax on the income received from the rent of the said house property shall not be
deductible until the certificate is cancelled.
(4) For the purposes of this section, 'Rent' means any payment, by whatever name it may be called, made
by way of a lease, tenancy or any contract or agreement for the use of any building including any furniture,
fixtures and land.

Sec 267 (2) Where any such person having income from the rent of tangible property fails, without
reasonable cause, to comply with the provisions of sub-section (3) of section 72 or the provisions of any
order or rule made for the purpose of that section, the Deputy Commissioner of Taxes may impose on him
penalty of 50% (fifty percent) of the tax payable from rental income of tangible asset or taka 5 (five)
thousand, whichever is higher.
 3. Agricultural income (section 40-43):
Particulars Amount

Sale of crops
Income from any land or building used for agricultural purposes
Income from granting a right [' Barga']
Income from tea garden or rubber garden [60%]
Revenue profit by sale of discarded or demolished agricultural machineries
Other income relating to agriculture
Less : Admissible expenses -
1. Land development tax Full
2. Any taxes [local taxes, etc.] Full
3. Production costs :
Cost for cultivating the land or raising live-stock
Ordinary processing costs to make crop marketable
Transportation cost of crops or livestock to market
Maintenance cost of agricultural equipment & up keeping of cattle for cultivation
(If proper books of accounts do not maintained an expenditure equivalent to 60% of Market
Price of the produced Agro products is allowed as admissible expense)
4. Insurance premium Full
5. Repair and maintenance of irrigation plant Full
6. Depreciation Full
7. Interest on mortgage loan Full
8. Interest on borrowed capital Full
9. Loss due to discard/demolish of agricultural machineries Full
10. Other revenue expenses Full

40. Income from Agriculture.—

(1) Income earned by a person from the activities related to agriculture shall be classified as
income from agriculture.
(2) 40% (forty percent) of the proceeds from the sale of tea and rubber produced and processed
by any person shall be deemed to be business income and 60% (sixty percent) shall be deemed
to be income from agriculture.
(3) Agriculture means any kind of horticulture, animal husbandry, natural use of land, poultry and
fish farms, reptile farms, nurseries, any kind of cultivation on land or in water, egg and milk
production, timber, grass and shrubs fruit, flower & honey and seed production.
41. Special Agricultural Income.—
(1) Without prejudice to the generality of section 40, the provisions of this section shall apply
to the computation of special agricultural income.
(2) If an asset is sold in any income year after being used by the taxpayer under section 40, it
shall be computed as follows, namely :-

SI. No Sale Proceeds Amount of Money Treated as Income

1 2 3
a-b shall be treated as 'Capital Income'
category income of the concerned taxpayer
in the said income year;
If the proceeds of sale are more than the
1 b-c shall be considered as the income of
acquisition value of the asset
the concerned taxpayer in the " income
from agriculture" category in the sai d
income year.
 a-c shall be considered as the
If the realizable value is not more than
income of the concerned tax payer In
2 the asset's acquisition value, it is
more than its disposal value
the “income from agriculture" category
in the said income year
(3) If in any income year the amount received by the taxpayer as insurance, salvage or compensation due to
the abandonment, wiped out or destruction of any asset used in his agricultural work exceeds the
depreciated value of the said asset, the said amount shall be included the income from agriculture sector as
described below, namely:
(4) For the purposes of this section, -
a= sale proceeds of the asset or, as the case may be, proceeds of insurance, salvage or
compensation against the asset,
b = acquisition value of asset, and
c = shall mean calculated depreciated value of the asset after allowing depreciation under the
Third Schedule,
(5) As per column (2) of the table in sub-sections (2) and (3), if the difference between the sale
proceeds or, as the case may be, the amount received for insurance, salvage or compensation
against the asset and the depreciated value is negative, the result shall be expended on 'income
from agriculture' shall be deemed to be and shall be included in the allowable general deduction.
42. Deductions from Agricultural Income.-
(1) Subject to this Act, in computing the taxable income of a person in the agricultural income
sector in any income year, the amount expended by the taxpayer in that year, other than capital
expenditure or personal expenditure, wholly and solely for the purpose of agriculture shall be
allowable as deduction and the following deductions shall be treated as ordinary deductions shall,
namely:-
(a) any tax, land development tax or rent paid on land or yard used for agricultural
purposes;
(b) rent payable for land or yard used for agricultural purposes, development &
maintenance charges and cultivation charges;
(c) interest or profit payable on loans taken for agricultural purposes;
(d) maintenance and repair of machinery and equipment used in agriculture and rearing of
livestock for cultivation, related processing or transportation;
(e) insurance premiums payable for compensation of land or grounds or for compensation
of crops or produced from the land or grounds or for the purpose of security in the rearing
of cattle;
(f) money spent to protect agriculture from natural calamities or any other damage;
(g) the following expenses subject to the permissible limits specified in the Third
Schedule-
(i) depreciation of assets used by the taxpayer in agriculture concerned;
(ii) amortization of intangible assets used in the agricultural activities concerned;
(h) where the animal used in the taxpayer's agricultural work has died or become
permanently incapacitated, an amount equal to the difference between the actual purchase
price of the animal and, as the case may be, the proceeds from the sale of the animal or the
sale of its meat;
(i) any expenditure incurred in connection with a visit abroad as a member of any
delegation on agriculture sponsored by the Government, which is not capital in nature;
j) any expenditure incurred in imparting training to citizens of Bangladesh on matters
related to any such scheme as approved by the Board;
(k) expenditure incurred in the conduct of scientific research relating to agriculture or
expenditure incurred in the conduct of such scientific research whereby the research is
conducted wholly and exclusively for the purpose of agricultural development of the
taxpayer in Bangladesh.
 (2) Only so much of any expenditure under this section as relates to income from agriculture shall
be deemed to be allowable expenditure.

43. Computation of special deductions in case of non-maintenance of Books of Accounts.—

(1) If it appears that,-
(a) the taxpayer does not follow a regular accounting system;
(b) the taxpayer applies any method on the basis of which it appears to the Deputy
Commissioner of Taxes that it is not possible to arrive at a conclusion as to the income of
the taxpayer;
(c) the taxpayer has failed to maintain records of accounts or transactions; or
(d) the accounts or records of transactions maintained by the taxpayer are not verifiable,
notwithstanding anything contained in any other section, 60% (sixty percent) of the
market value of the agricultural produce so produced shall be treated as allowable
expenditure.
(2) This clause shall not apply in cases where the owner of the land or yard receives income from
agriculture at the rate of Adhi, Barga, Bhaga or share.
44. Deductions shall not be Admissible in Certain Cases.-
(1) Deduction claimed under this Chapter shall not be allowed unless the provisions of Part 7
are complied with in all such cases where deduction or collection of tax at source is applicable.
(2) The provisions referred to in section 55 shall apply as if the provisions were related to this
Chapter.

6th Schedule :
Part 1
(20) Any income of a natural person falling under the "Income from Agriculture" sector not exceeding
taka 2 (two) lakhs, if the said person-
(a) is a farmer by occupation;
(b) has no income in the relevant income year other than the following income, namely;-
(i) income arising from the cultivation of land;
(ii) Income not exceeding Tk 20 (twenty) thousand on account of interest or profit.
 5. Capital gain (section 57 - 61):
Particulars Amount Amount

Sale proceeds of capital assets, or (whichever is 300,000

300,000
Fair market value at the time of transfer higher) 280,000

Less : Allowable deductions ["acquisition value of assets" : see sec 58(2)(b) ]

(a) Expenditure incurred to transfer the capital asset(s) 10,000
(b) Cost of acquisition 200,000 260,000
(c) Capital expenditure incurred for improvements of the asset(s) 50,000
Capital gain 40,000

Sec 2 (77) "Capital Asset" means-

( a) property of any nature or kind held by any taxpayer;
(b) any business or undertaking as a whole or as a unit;
( c) any share or stock,
However, it shall not include the following matters, namely:-
(i) any stocks, consumables or raw materials held for the purpose of the taxpayer's business;
(ii) personal goods, such as wearable clothing, gold ornaments, furniture, fixtures or
which are used by the taxpayer or any member of his dependent family only for
personal purposes and not for the purpose of his business;

Sec 2(63) "Sale Proceeds" means-

(a) if the asset is sold, the proceeds or the fair market value of the asset, whichever is
(b) if the asset is transferred by way of exchange, the fair market value of the asset
acquired by the said transfer;
(c) if the asset is transferred by any means other than sale or exchange, the
consideration received in return for such transfer; salvage or indemnity against the
(d) any asset abandoned, wiped out, destroyed or lost, the scrap value of the asset, or
the amount recovered by sale, together with any amount received or due for insurance,
(e) if the asset is acquired compulsorily under any law in force in Bangladesh, the
compensation paid for the acquisition;
(f) if the use of the asset in the agricultural work of the taxpayer is ended, the fair
market value of the asset at the time of ending;
(g) export value received if any plant or machinery is exported or transferred
outside Bangladesh after its use in Bangladesh;
(h) if the value of any passenger vehicle is subject to the ceiling under the Third
Schedule, the amount shall be-
a x (b/c), where-
a = sale proceeds of the vehicle;
b = the amount specified in the Third Schedule;
c = actual expenditure incurred to acquire the vehicle;
Explanation.- "Sale" shall include exchange or otherwise transfer or acquisition
compulsorily under any law in force;
Sec 2(93) "Transfer" in the case of capital asset, shall include sale, exchange or relinquishment or
extinguishment of any title to the asset, but shall not include the following matters, namely:-
 (a) if the transfer of capital assets takes place by way of donation, under will, bequest
or an irrevocable trust;
(b) if the assets of the company are distributed in any way to the shareholders on the
winding up of the company; and
(c) at the time of dissolution of a firm or other association of individual or if any
capital asset is distributed on partition of the Hindu Undivided Family.

57. Capital Gains.-

Profits and gains arising from transfer of ownership of capital assets shall be capital income:
Provided that any notional gain or profit arising out of any asset which has not actually been
transferred by following the fair market value method as per International Accounting
Standards (IAS) or International Financial Reporting Standards (IFRS) shall not be treated

58. Calculation of Capital Gains.-

(1) Subject to the provisions of this Act, the capital income of a person shall be the difference
between the sale or transfer price of an asset in the open market and the acquisition price of
(2) For the purposes of this section,-
(a) open market sale or transfer value means the open market sale or transfer value of an
asset, whichever is higher between 'a' and 'b', where-
a = Amount received or accrued from transfer of assets; and
b = fair market value of the asset on the date of transfer;
(b) "acquisition value of assets" shall mean-
(i) The acquisition cost of an asset shall be the sum of the following costs-
(1) any such expenditure which is solely connected with the transfer of title to the said asset;
(2) the purchase value of the asset; and
(3) the cost of development of such assets, if any, other than the cost allowed under section
38, 42,49, 50 or 64;
(ii) Where the transferor has acquired the property .as described below-
(1) under any gift, donation or bequest;
(2) by succession, inheritance or traditionally;
(3) subject to transfer of trust, revocable or irrevocable;
(4) by any distribution of capital resources for winding up a company; or
(5) by distribution of capital assets in case of division of a firm or association of individual or
Hindu undivided family,
In that case, the fair market value on the date of acquisition of ownership of the asset by
the transferee shall be considered as the acquisition value of the asset.

59. Calculation Period.-

Income arising from transfer of capital assets shall be included as income in the income year
in which the transfer takes place.

60. Limitation of approval of Deduction.-

Tax deduction at source is applicable, unless tax is deducted or collected at source in
respect of any such expenditure and duly paid in accordance with the provisions of this Act,
such expenditure shall not be treated as allowable deduction under this Chapter.

61. Other Factors in Computation of Capital Gains. -

(1) If the fair market value of any asset is more than 15% (fifteen percent) of the full value
of the goods declared by the taxpayer, the Deputy Commissioner of Taxes, with the prior
approval of the Inspecting Additional Commissioner, determine the fair market value of the
 (2) If the fair market value of any asset is more than 25% (twenty five percent) of the
acquisition value declared by the taxpayer, the Commissioner of Taxes may, in the manner
prescribed by the Board, offer to purchase the asset at the declared acquisition value.
(3) Capital gains arising from the transfer of all the assets of a partnership firm to a new
company incorporated under the Companies Act, 1994 (Act No. 18 of 1994) shall be exempted
from tax if the consideration of the transfer of all the assets is invested in the equity of the new
company.

7th Schedule
1. Such income shall be treated as "capital income" under this Act and shall be taxed as under-
(a) 15% (fifteen percent) on the capital income earned by the company;
(b) In respect of taxpayers other than companies-
(i) where the capital asset is acquired or transferred within 5 (five) years of receipt, such
capital income shall be included in the gross income and the regular rate on the gross income;
(ii) 15% (fifteen percent) of such capital income in cases where the capital asset is transferred
after the expiry of five years from its acquisition or receipt.

As per SRO 196-AIN/IT/2015 circulated on 30/6/2015, special tax rate is applied on capital gains
from sale of shares by specified persons as mentioned below:
The following reduced tax rates will be applicable on the income earned from transaction of securities
(excluding government securities) listed in the Stock Exchanges:

Sl. Nature of taxpayer’s Tax rate

Any income earned from trading of shares/securities by any
Sponsor Shareholder / Director of a Bank, Financial Institution,
(a) Merchant Bank, Insurance Company, Leasing Company, Portfolio 5%
Management Company, Stock Dealer or Stock Broker Company
Any income earned from trading of shares/securities by any Shareholder
[excluding the Sponsor Shareholders/Directors mentioned in above Sl.
(b) (b)] having 10% or more shares of the total paid up capital of a 5%
company / companies listed at any time during the income year.

1. If a shareholder mentioned in Sl. (c) is a company or firm, then tax rate will be 10%, as 10% tax rate is
applicable for company and partnership firm.
2. In case of transferring the shares by any sponsor shareholder / director mentioned in Sl. (b), tax will be
deducted at the rate of 5% on the difference between transfer value and cost of acquisition of the securities as per
section 53M of the ITA, 1984.
3. The income from trading of shares of all other types of taxpayers’ excluding those mentioned in the above lists
is exempted from tax.
4. Here, the term “securities” will include any stocks, shares, mutual fund units, bonds, debentures or other
securities of any listed company tradable in the stock exchanges of the country (excluding the securities issued by
6. Income from financial assets (section 62-65):

62. Income from Financial Assets.-

(1) The following income of a person shall be classified under the head
"Income from financial asset", namely:-
(a) interest, profit or interest on Government or Government-approved
(b) interest, profits or dividends on debentures or any other form of securities
issued by local authorities or companies;
(c) interest or profit due from the following sources, namely:-
(i) deposits kept in any bank or financial institution, by whatever name
(ii) any financial product or scheme;
(d) dividends.
(2) Capital income derived from transfer of financial assets shall not be
classified as "income from financial assets".
63. Computation of Income Period.--
In the income year in which a person receives income from financial assets
or in the income year in which such income accrues to him, whichever
occurs first, it shall be included in that income year.
64. Deductions from Income from Financial Assets.-
In computing income under "Income from Financial Assets", the
following expenses shall be allowed, namely:-
(a) amount deducted without income tax against interest or profit paid to
the taxpayer by the bank or financial institution;
(b) interest paid on money borrowed solely for the purpose of earning
"income from financial assets";
( c) any other expenditure incurred solely for the purpose of earning
the relevant income, other than the expenditure referred to in clause (a) or
(b).
65. Deductions not Admissible in Certain Cases : -
Notwithstanding anything contained in this Chapter, the following expenses
shall not be allowed in computing income from financial assets, namely:-
(a) any interest payable outside Bangladesh from which no tax has been
deducted or paid in accordance with the provisions of this Act;
(b) interest or commission paid against income from such financial
assets as applicable tax-exemption;
( c) any expenditure of a capital or personal nature.

6th Sch Part 1 : (18) any income received by a taxpayer from a Wage Earners Development Fund,
US Dollar Premium Bond, US Dollar Investment Bond, Euro Premium Bond, Euro Investment Bond,
Pound Sterling Investment Bond or Pound Sterling Premium Bond;

Sec 2(87) "Securities" shall include-

(a) Treasury Bills, Bonds, Savings Certificate, Debentures, Sukuk or Shariah-based
securities or similar instruments issued by Government;
(b) shares or stocks issued by any company or legal entity or issuer, instruments issued by
way of mortgage or charge or hypothecation, bonds, debentures, derivatives, units of
any collective investment scheme including mutual funds or alternative investment funds,
sukuk or similar instruments issued based on Shariah , and the purchase right or power of
attorney (warrant) to receive the aforesaid documents:
Provided that it shall not include any currency or note, draft, cheque, bill of exchange, bank
acceptance, trade receivables or trade payables;

242. Avoidance of Tax by Transaction of Securities.-

(1) Where the owner of any securities after the sale or transfer of his securities repurchases or
acquires them, or purchases or acquires similar securities, and in consequence of such
transaction is payable by the owner in consideration of the sale or transfer of the original
securities if any interest is not received by the owner, the aforesaid interest payable shall, for
all purposes of this Act, be deemed to be the income of such owner and not become the
income of any other person, whether the aforesaid interest payable is taxed otherwise

(2) Where a person has a beneficial interest in any securities for any period of the income
year and does not receive such income as a result of dealing in such securities or the income
arising therefrom during the said year or the amount received by him as income, if from
the said securities is less than the amount that could have been accumulated and
proportionately deposited day after day at the proportionate rate of the said period, but in
that case the total income arising from such securities during the said period shall be
deemed as income of the said person.

(3) Where any person engaged in the business of dealing in securities, in whole or in part,
purchases or acquires securities from any other person and re-sells or transfers the said
securities to such other person or sells or transfers similar securities to him and as a result
of the said transaction although the interest payable by him on the securities so
purchased or acquired is not treated as his income by reason of the provisions of sub•
section ( 1 ), in that case, for any purpose of this Act in relation to the said transaction, any
income arising from such business or for the purpose of computing any kind of income or
loss will not be considered.
(4) The Deputy Commissioner of Taxes shall, by notice in writing, within the period
specified in the notice, which shall not be less than 28 (twenty-eight) days, any person to
file a description of all the securities owned by him or of the securities in which such
person had a beneficial interest at the time specified in the notice and for the other purposes
of this section and for the purpose of finalizing the tax of the interest received on the
securities, the Deputy Commissioner of Taxes may issue such notice to furnish such
other information as he may consider necessary.
(5) For the purposes of this section-
(a) "interest" shall also include dividends; and
(b) such securities shall mean all securities, whatever the difference may
be in the aggregate nominal value of the securities concerned, or in the form in
which they are held or in the manner of transfer, which confer upon the owner the
same right to the interest and profits of the same person and are identical, provides
opportunities in establishing such rights;
7. Income from other sources (section 66 - 69):
Particulars Amount

Any commission/fee received from parties other than employer

Royalty income from books
Income from prize bond/lottery/quiz competition/ crossword [Amount received x 100/80]
Commission/fee as Director of any company
Non-agricultural income like sale of forest trees, sale of fruits, sale of honey, sale offish of pond (other than firm) etc.
Income from invigilation & exam script evaluation
Income from writing articles/columns in newspapers Income from participating in radio/ TV/cultural/training programs
Income from lease of non-agricultural land
Income from tuition
Income from underwriting commission for sale of shares and securities.
Income from patent/license
Income from rent of boat/mooring terminal
Income from letting out household appliances like furniture, machineries etc.
Unexplained investments deemed to be income
Any other income not classified under any head

Less : Allowable deductions u/s 68:

Interest on loan taken to purchase share
Any other related revenue expenditure

Total income

66. Income from other sources.-

The following incomes of a taxpayer shall be classified and computed under the
head of Income from Other Sources, namely:-
(a) income earned by way of royalty, license fee, fee for technical know-how
and grant of right to use intangible property;
(b) cash subsidy provided by the Government;
(c) income from any source not classified under any other head mentioned in section 30.

67. Special Areas of Income from Other Sources.-

(1) Without prejudice to the generality of section 66, in special cases, the provisions
of this Chapter shall apply to the computation of "income from other sources" in
accordance with the provisions of this Chapter.
(2) where any sum found credited in any income year in the accounts of the taxpayer
or in any other documents, the nature and source of which the taxpayer cannot
provide any satisfactory explanation or the explanation of the taxpayer does not
appear to the satisfaction of the Deputy Commissioner of Taxes, in that case, the said
amount shall be included as income of the taxpayer under "income from other
sources" in the said income year.
(3) Where (a+b+c) is greater than (d+e+t) in case where the taxpayer owns any asset
or incurs any debt or incurs any expenditure or any such transaction affecting the
assets of the taxpayer in any income year, ( a + b + c ) - ( d + e + f ) shall be
included as income of the taxpayer in the "income from other sources" category in the
said income year, where-
a = Increase in net assets, b = Actual cost incurred,
c = Other expenditure from the Fund other than a and b,
d = Total Assessed Income,
e = Assessed tax exempted income, and
f= Other acceptable receipts of funds other than d and e.
(4) Where the taxpayer purchases from a person any asset other than commercial
stock or financial asset and the Deputy Commissioner of Taxes has reasonable
grounds to believe that the price paid by the taxpayer is less than the fair market
value, the difference between the price paid and the fair market value shall be treated
as income of the taxpayer and classified as "income from other sources".
(5) Any fee, commission, compensation, goodwill by whatever name so called,
received by the taxpayer in any income year on account of cancellation or rescission
of any agreement or alteration or modification of any terms of the agreement shall be
deemed to be and included as "income from other sources" of the taxpayer in the
relevant income year.
(6) Any lump sum received or due by a taxpayer in any income year in the form of
salami or premium by way of lease or rent shall be included as income under "income
from other sources" category in that income year of the taxpayer.
(7) If tax is not deducted or collected at source in accordance with Part-7 from the
amount paid by a taxpayer during the acquisition of any asset in any income year,
such amount paid shall be included as income of the "income from other sources"
category in the said income year of the taxpayer.
(8) If a taxpayer receives any profit or benefit in any income year in view of waiver of
loan liability, whether convertible or not, the monetary value of the said profit or
benefit shall be treated as income of the taxpayer in that income year and shall be
included in the head "income from other sources" category:
Provided that the provisions of this sub-section shall not apply in the following cases,
namely:-
(a) waiver of loan or interest granted to a natural person by any financial institution
registered under the Scheduled Bank or the Financial Institutions Act, 1993 (Act No.
27 of 1993);
(b) by reason of any margin loan or waiver of interest arising thereon by a merchant
banker and portfolio manager or stock broker registered under the Bangladesh
Securities and Exchange Commission Act, 1993 or rules made thereunder against an
investment in any securities traded on a stock exchange by an individual taxpayer up
to Tk. 10 (Ten) lakh profit or benefit.
(9) In any income year, if the taxpayer receives any money by winning lottery, word
game, card game, online game or games of any such nature, such receipt shall be
included as income under "income from other sources" category of the concerned
taxpayer in the said income year.
(10) Where such company, which is not listed on the Stock Exchange, receives paid-
up capital in cash from any shareholder without bank transfer in any income year, the
said paid-up capital shall be included as income under the "income from other
sources" category of the company taxpayer in that income year:
Provided that this provision shall not apply if any assets or services other than cash
are received as paid-up capital in accordance with the Companies Act, 1994 (Act No.
18 of 1994).
( 11) Where a company taxpayer borrows any amount from any other person other
than through the medium of a bank account, such amount shall be deemed to be
income of the taxpayer in the income year in which the loan was received and shall
be included as "income from other sources" category:
Provided that where any loan referred to in this sub-section or any part thereof is
repaid in any subsequent income year, the amount so repaid shall be excluded while
computing the income of such subsequent income year.
 (12) Where a company taxpayer purchases directly or on hire one or more motor cars or jeeps and
the value of any motor car or jeep exceeds 10 (ten) percent of its paid-up capital including reserves
and accumulated profits, in that case 50% of the amount exceeding such l0% shall be included as
income in the "income from other sources" category of the taxpayer in the said income year.

(13) In case any individual taxpayer receives from any other person other than crossed check or
bank transfer as any advance, loan, donation or any other form of deposit exceeding a total amount
of Tk. 5 (five) lakh, in such case the amount so received in the income year in which the advance,
loan, donation or any other form of deposit was received, the income of the taxpayer under
"income from other sources" shall include: Provided that nothing in this sub-section shall apply to
the following areas-

(a) if such money is received from the spouse, parent or child and the same is withdrawn from
the bank account of the donor;
(b) any deposit accepted by a bank, financial institution and any organization registered with the
NGO Affairs Bureau or the Microcredit Regulatory Authority.
(14) Where any such taxpayer not engaged in real estate business purchases building materials for
the construction or repair of any house property or part thereof and does not pay the same within 2
(two) income years after the end of the income year related to such purchase, in that case, the
same shall be included as "income from other sources" category of the taxpayer in the income
year following the end of the said 2(two) income year.

(15) Where a taxpayer files an revised return under section 175, 180 or 212 and shows in the said
revised return any such income which is exempted or subject to a reduced rate of tax, the amount
equal to a-b shall be included in the income year of the taxpayer from "income from other
sources" category, where-
a = amount shown in revised return as income subject to tax exempted or reduced
rate of tax,
b = Income shown in original return:
Provided that the provisions of this sub-section shall not apply in cases where the
banking medium is attached and suitable evidence is produced.
68. Allowable deductions in computing income from other Sources.-
(1) Subject to the provisions of this Act, in computing the income of any person
under "income from other sources" in any income year, such expenditure shall be
allowable as expenditure, not capital or personal expenditure, incurred by such person
only for the purpose of earning the relevant income.

(2) Except sub-sections (5) and (6) of section 67, no expenditure of any kind
shall be allowed in computing income under other sub-sections of section 67.
(3) In allowing expenditure under sub-section (l), the reasonableness of such expenditure
shall be considered.
69. Disallowance of deductions in certain cases.-
(1) Expenditure allowed fully or partly against any asset under this Chapter in any income
year shall not be allowed against the same asset.

(2) The provisions mentioned in section 55 relating to limitation of

authorization of expenditure shall apply to such cases in this Chapter.

Sec 2(79) "Royalty" means any such remuneration as may be earned as under and
includes any lump sum other than remuneration treated as income of the recipient
under "Capital Income", namely:-
 (a) by transfer of all or any rights, including the permitted license of patents,
industrial designs or trademarks or any other intellectual property;
(b) by providing information regarding the use of patents, industrial designs
or trademarks or any other property related to intellectual property;
(c) by using such property of patent, industrial design or trademark or any
other property related to intellectual property;

(d) by providing information relating to technical, artistic, commercial or

scientific knowledge, experience or skill;
(e) any transfer of rights, including copyright or licensing of the film, other
than the sale, distribution or exhibition of the cinematograph film; or
(f) by providing any services in connection with the aforesaid activities;

Sec 2(30) "Technical Service Fee" shall include remuneration received for
providing financial management, technical or consultancy services, including lump
sum remuneration, and any technical or other professional services, but shall not
include the following, namely:-
(i) remuneration received from any construction work, pairing
assignment work, mining work or similar project undertaken by the
recipient; or
(ii) any remuneration classifiable as "income from employment"
income of the recipient;

91. Deduction from Payment for Intangible Property.-

A person responsible for payment of royalty, franchise or license, trademark, patent,
copyright, industrial design, plant variety, geographical indication product or any other
property related to intellectual property or immaterial or abstract or intangible matter; tax shall
be deducted at the rate mentioned in the table below at the time of such payment or credit,
namely:-

Description of Repayment Tax Deduction Rate

If the base price does not exceed Tk. 25
10% (ten percent)
(twenty five) lakhs
If the base price exceeds Tk. 25 (twenty five)
12% (twelve percent)
lakhs
70. Set off and Carry Forward of Losses.-
(1) Subject to the provisions of sub-section (2), the assessed loss of any head in
any tax year shall be adjusted against the income of any other head.
(2) Any loss mentioned in the table below shall not be adjusted against income
from any category or source other than income from that category or source only,
namely:-
SL Source of Income Adjustment
1 Capital loss Adjustment can only be made with capital income.
Adjustments can only be made with income from
2 Business loss
business.
Loss in speculative Adjustments can only be made with income from
3
business speculative business.
Loss of business Adjustments can be made only with income from
4
in tobacco products trading in tobacco products.
(3) Loss of any source or category to which tax is exempted, reduced rate of tax
or minimum tax is applicable shall not be adjusted or carried forward.

(4) The assessed loss of a firm or partnership shall be adjusted only against the
assessed income of the firm or partnership and shall not be adjusted against the income
of any partner of the firm or member of the partnership.

(5) If the assessed loss of any category in a tax year is not fully adjusted with the
income of any other category or source of that year, the adjustment will be made in the
next 6 (six) tax years by carried forward of the unadjusted loss.
(6) Subject to the Eighth Schedule, where a person is succeeded in a business or
profession otherwise than by succession, the successor shall not be able to set off or set
off the loss of the predecessor against any of his own income.

71. Carry Forward of Depreciation Allowance.-

(1) If any depreciation allowed under this Act is not fully charged as an expenditure
against the gross income of a tax year, it shall be added to the depreciation of the next
tax year.depreciation allowance disallowed for failure to comply with any provision of
(2) Any
this Act shall not be carried forward.
(3) Carried forward loss shall be adjust before carried forward allowance is charged.
(4) Depreciation Allowance allowed may be adjusted fully adjustment is made.
72. Accounting Method.--
(1) Subject to other provisions of this Act, the income of a person shall be computed in
accordance with the method of accounting regularly applied.
(2) Where a person considers that any change in the method of accounting is necessary,
such person may apply to the Deputy Commissioner of Taxes regarding the desired
change and on receipt of such application the Deputy Commissioner of Taxes may approve
the necessary changes to clearly reflect the income of the taxpayer.
(3) The Board may, by rules, prescribe the method of accounting and other verification criteria
for any business, or any class of business, or any other source, or income from any source.
(4) Without prejudice to the preceding provisions, a company shall prepare accounts and
financial reports in accordance with International Accounting Standards (IAS),
International Financial Reporting Standards (IFRS) and relevant laws in force in
Bangladesh.

73. Filing of Audited Financial Statement by Company etc.-

A copy of income statement and a copy certified by a chartered accountant with annual return
of income of any company, firm, association of individual and any person deriving income
from long-term contracts having a turnover above Tk. 3 (three) crore will provide that-
(a) accounts have been maintained and returns prepared and filed in accordance with
International Accounting Standards (IAS), International Financial Reporting Standards (IFRS)
and relevant laws in force in Bangladesh for the said tax year;
(b) the criteria prescribed by the Board, from time to time, have been followed; and
(c) it has been audited in accordance with International Standards on Auditing (ISA).

74. Method of Accounting for Long-term Contracts.-

(1) Where a person follows the appropriate accounting method for computed income
classified as 'Income from business', the income arising from long-term contracts in any
income year shall be calculated according to the percentage method.
(2) The percentage of completion of long-term contracts in any financial year shall be
determined by comparing the total allocated costs of the contract before the end of that
financial year and the estimated total contract costs determined at the beginning of the
contract with the costs incurred.
(3) For the purposes of this section-

(a) "long-term contract" means a contract for the manufacture, installation, or construction,
or the performance of services in connection with each contract, which is not completed within
the financial year in which the work under the contract commences, but approximately 6 (six)
months all contracts other than such contracts will expire from the date of commencement of the
work under the contract.
(b) percentage method of completion" means the generally accepted accounting policy under
which revenue and expenditure covered by long-term contracts are recognized at the stage of
completion of the revised contract under sub-section (2).
75. Incomplete or Incorrect Accounts, etc.-
(1) Nothing in this Chapter shall prevent from the power of the Income-tax Authority to disregard any
return, statement or document furnished by a taxpayer, or the said claim during audit or assessment
proceedings, if it is not verifiable.

(2) Where no conventional method of accounting method is followed, or the Deputy Commissioner of
Taxes is not satisfied as to the correctness or completeness of the accounts of the taxpayer, or the accounts
of the taxpayer have not been prepared and maintained in accordance with the provisions of section 72(3),
in such manner as the Deputy Commissioner of Taxes may think fit, shall assess the taxpayer's tax.