Branch Office Setup in Bangladesh: From Approval to Operation

Branch office setup in Bangladesh begins the day the BIDA permission letter arrives. The permission allows the branch to exist, but banks, clients and tax authorities will not deal with it until a series of registrations and practical arrangements are in place. Doing these in the right order matters, because many offices ask for the documents issued by the previous one.

This page is a hands-on checklist for country managers, regional finance teams and HR leads tasked with getting the branch running. If you have not yet obtained permission or are still choosing between a branch and a subsidiary, our branch office establishment page covers the BIDA approval stage and its conditions.

Branch office setup checklist in the right order

The sequence below reflects how documents typically depend on one another in Dhaka. Some steps can run in parallel once the bank account and office address are settled.

• Secure an office address with a lease agreement in the branch's name
• Open a bank account with an authorised dealer bank using the BIDA permission and parent documents
• Receive the initial inward remittance and obtain the encashment certificate
• File the foreign company documents with RJSC under the Companies Act 1994
• Obtain e-TIN from NBR for the branch
• Apply for the trade licence from the City Corporation or local authority
• Register for VAT and obtain BIN by filing Mushak 2.1 online
• Register with other bodies if the activity requires, such as a chamber or sector regulator

RJSC registration of a foreign company branch

A foreign company establishing a place of business in Bangladesh must file prescribed documents with RJSC within the time set by the Companies Act. These include a certified copy of the charter documents, the address of the principal office abroad and of the Bangladesh office, the list of directors, and the name and address of a person resident in Bangladesh authorised to accept service of notices. After registration, the branch files its annual accounts with RJSC as a foreign company.

Tax, VAT and payroll set-up

Most branch problems in the first year come from tax administration rather than from the permission itself. Local clients will deduct TDS from payments to the branch and issue certificates, which should be collected and reconciled. The branch must deduct tax at source from salaries, rent and supplier payments, deposit it with the government and file withholding returns. For VAT, the branch issues Mushak 6.3 invoices where applicable, handles VAT deducted at source with Mushak 6.6 certificates, and files the monthly Mushak 9.1 return by the 15th of the following month.

• Choose an accounting system that can produce BFRS-compliant statements for audit
• Register foreign staff for work permits and include them in payroll and tax
• Set up a filing system for TDS and VDS certificates received
• Plan the annual income tax return for the branch and its audit

Hiring and work permits for foreign staff

A foreign national working in the branch, including the country manager, needs an appropriate visa (usually E-type for employment) and a work permit from BIDA. Applications usually need the branch's permission letter, encashment certificate, RJSC and tax documents, so they come after the core set-up. Local staff are hired under the Bangladesh Labour Act 2006, with written appointment letters and statutory leave and benefits.

Mistakes that slow down branch setup

These are the issues we most often see when a branch has been set up without local coordination.

• Remitting the initial capital before the bank account is properly designated, so no valid encashment certificate is issued
• Leasing an office in a name or address that does not match the BIDA permission
• Starting to invoice clients before the BIN is in place
• Not filing RJSC foreign company documents, which later blocks certified copies and renewals
• Paying foreign staff abroad without Bangladesh payroll and tax treatment

How the process works

1. Kick-off and document collectionWe collect the BIDA permission, parent documents and manager details and fix the set-up sequence and owners.
2. Bank and remittanceWe support the bank account opening and track the inward remittance until the encashment certificate is issued.
3. RJSC filingWe prepare and file the foreign company documents with RJSC and obtain the registration record.
4. Tax, VAT and trade licenceWe obtain e-TIN, trade licence and BIN and configure invoice and withholding processes.
5. Work permits and payrollWe prepare work permit applications for foreign staff and design compliant local payroll.
6. First-year compliance planWe hand over a calendar for VAT, withholding, audit, tax return and BIDA reporting obligations.

Typical timeline: With permission in hand and documents ready, a branch is often operational within one to three months, depending on banking, RJSC and local authority processing and work permit timing.

How Tax & VAT Associates helps

• Project plan with document dependencies and responsible persons
• Bank account opening support and encashment certificate tracking
• RJSC foreign company filing and later annual filings
• e-TIN, BIN and trade licence registration
• Work permit applications and local payroll set-up
• Monthly VAT, withholding and accounting support after launch

Frequently asked questions

Related services

Last reviewed: 6 October 2026. Bangladesh tax and regulatory rules change with each Finance Act, SRO and authority circular. This page is general guidance; confirm current requirements for your case before filing.