Corporate tax in Bangladesh is income tax charged on the profits of companies and other entities under the Income Tax Act 2023. The rate depends on the type of company, such as listed, non-listed, bank, telecom or one-person company, and on conditions like cashless transactions. Rates are set by each year's Finance Act, and minimum tax, advance tax and TDS credits also affect the final liability.
Corporate tax in Bangladesh is rarely just profit multiplied by a rate. Your liability is shaped by which category the company falls into, whether it met the conditions for the lower rate, how expenses were paid, whether minimum tax on turnover exceeds the regular tax, and how much tax has already been deducted at source by customers and banks.
This page is about the liability itself and how to plan it during the year. If you need help preparing and filing the return, see our company tax return and corporate tax return pages. If you run a small private company and want a plain introduction, our company tax page covers the basics.
On this page
How corporate tax rates are set
The Finance Act fixes separate rates for publicly traded companies, non-listed companies, one-person companies, banks and financial institutions, mobile operators, tobacco manufacturers and some other sectors. For several categories the lower rate applies only if the company meets conditions, typically that receipts and payments above specified limits are made through bank transfers rather than cash. Missing those conditions can raise the effective rate for the year, so we check them before the year closes.
Minimum tax, advance tax and TDS
Bangladesh imposes a minimum tax based on gross receipts, so a company can owe tax even in a loss year. Tax deducted at source on certain receipts, such as on imports, contract payments and supplies, can also be treated as minimum tax. The company pays whichever is higher of the regular tax and the minimum tax, as the Act defines it.
Companies with expected liability above the threshold must pay advance tax in quarterly instalments during the income year. TDS deducted by customers, AIT on imports and advance tax paid are credited against the final liability in the return, so collecting every certificate and challan is part of tax planning, not just filing.
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Deductions and disallowances to watch
- Expenses must be incurred for the business and properly documented; cash payments above prescribed limits can be disallowed
- Payments on which the company failed to deduct or deposit TDS may be disallowed in full or in part
- Tax depreciation follows the rates in the Act, not the accounting depreciation in the BFRS financial statements
- Certain expenses such as perquisites above limits, promotional spend and royalties or technical fees are subject to caps
- Transactions with foreign associated enterprises must be at arm's length under transfer pricing rules
- Business losses can be carried forward for a limited number of years under the conditions in the Act
Tax exemptions and reduced-rate regimes
Some industries and locations enjoy tax holidays or reduced rates through the Act or through SROs, for example certain enterprises in BEPZA export processing zones and BEZA economic zones, software and IT-enabled services, and specified sectors. These benefits usually have expiry dates and conditions, such as filing on time and maintaining separate accounts. We confirm what still applies before you build it into a budget.
Corporate tax planning during the year
- Run a mid-year projection using management accounts to estimate tax and advance tax instalments
- Review cash payment and receipt patterns against the conditions for the lower rate
- Audit TDS compliance on payments to suppliers, contractors, landlords and staff
- Collect TDS certificates from customers each quarter instead of at year end
- Plan dividend timing, considering tax on retained earnings and dividend withholding
- Align the audited financial statements with the tax computation well before the Tax Day
How the process works
- Company category checkWe confirm the company's tax category and which rate conditions apply for the income year.
- Projection from accountsWe prepare a tax projection from management accounts, including minimum tax and depreciation adjustments.
- TDS and cash compliance reviewWe sample payments and receipts to find TDS gaps and cash transactions that could cause disallowance.
- Advance tax scheduleWe calculate quarterly advance tax and remind you before each instalment date.
- Year-end tax packWe prepare the tax computation and supporting schedules ready for the audited accounts and return.
Typical timeline: A corporate tax projection typically takes one to three weeks depending on the quality of the books; ongoing quarterly reviews are usually turned around within a week of receiving the data.
How Tax & VAT Associates helps
- Corporate tax projection with regular tax versus minimum tax comparison
- Review of rate conditions such as bank-channel transactions
- TDS compliance health check on company payments
- Advance tax instalment calculations and reminders
- Tax depreciation and loss carry-forward schedules
- Advice on exemptions, SRO benefits and zone incentives
Frequently asked questions
What is the corporate tax rate in Bangladesh?
There is no single rate. The Finance Act sets different rates for listed companies, non-listed companies, one-person companies, banks, telecom operators, tobacco companies and others, and several categories get a lower rate only if conditions on bank-channel transactions are met. Because rates change frequently, we always confirm the rate for the specific assessment year.
Does a loss-making company pay corporate tax in Bangladesh?
Often yes. Minimum tax on gross receipts applies regardless of profit, and some TDS collected at source is treated as minimum tax and cannot be refunded. A loss-making company should still file its return on time, keep its losses recorded for carry-forward, and check whether the minimum tax rules apply to its turnover.
When is the corporate tax return due?
For companies, the Tax Day is generally the 15th day of the seventh month after the end of the income year. For a company with a June year end, that usually means mid-January. Banks, insurers and some financial institutions follow a calendar year. The NBR can extend dates, so check each year.
Can a company claim tax deducted by its customers?
Yes, TDS deducted by customers is credited against the company's final liability, provided you hold valid certificates or the deduction is visible in the NBR's records. Some deductions are treated as minimum tax. Missing certificates are one of the most common reasons companies pay more tax than they should.
What happens if a company pays suppliers without deducting TDS?
The company can be treated as an assessee in default for the tax it failed to deduct and may face additional amounts under the Act. The related expense may also be disallowed in the tax computation, increasing taxable profit. Fixing the process early in the year is much cheaper than correcting it in an audit.
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Learn more →Last reviewed: . 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.