Withholding Tax Return Filing in Bangladesh

Deducting tax at source is only half the job. The other half is the withholding tax return, which proves to NBR that what you deducted was actually deposited and tells the Taxes Circle whose tax it was. Without it, deductees struggle to claim credit, and the withholding entity risks having the related expenses disallowed in its own assessment.

This page is for accounts teams at companies, firms, NGOs, schools, hospitals and other organisations that act as withholding entities. It focuses on filing and reconciling the withholding tax return. For working out how much to deduct in the first place and at what rate, see our TDS and AIT calculation page.

Who must file a withholding tax return?

The Income Tax Act 2023 places withholding duties on specified persons, often called withholding entities. Broadly these include companies, firms, associations of persons, government bodies, NGOs registered with the NGO Affairs Bureau, cooperative societies, trusts, educational and medical institutions, and certain individuals in business above prescribed thresholds. If your organisation deducts tax from any payment, assume a withholding return obligation exists and confirm the frequency applicable to you.

What a withholding return reports

• Each category of payment on which tax was deducted, such as salary, contractor and supplier payments, house rent, professional or technical fees, commission and payments to non-residents
• Name, address and e-TIN of each deductee, where the format requires it
• Gross amount paid, tax deducted and date of deduction
• Challan number, date and amount for each deposit to the government treasury
• Any certificates issued to deductees
• Summary totals that should reconcile with the entity's ledger and bank statements

Frequency, deadlines and format

The filing frequency, due dates and prescribed format for withholding returns are set by the Act and NBR's rules and notifications, and they have changed in recent years. Some entities have also been brought onto online reporting systems. Because of these changes, we confirm the current requirement for your entity type at the start of each income year and set up a reporting calendar accordingly.

Salary withholding has its own annual statement requirements in addition to periodic returns, and employers must give employees a certificate of tax deducted so they can claim credit in their personal returns.

Reconciling before you file the withholding return

Most withholding problems come from poor reconciliation rather than wrong rates. Before each return, match three things: the TDS ledger, the bank statement showing challan payments, and the vendor or employee master data. Differences point to deductions that were made but not deposited, deposits made under the wrong code or e-TIN, or payments where deduction was missed entirely.

• Confirm each challan was paid under the correct economic code for the type of tax
• Check that deductee e-TINs are valid and correctly entered
• Identify payments above thresholds where no deduction was made
• Agree year-to-date totals to the trial balance before the final return of the year

Consequences of not filing or under-reporting

Failure to file a withholding return, or filing incorrectly, can lead to penalties under the Act. More costly in practice is the disallowance of expenses in the entity's own income tax assessment when tax was not deducted or deposited as required, plus the possibility of being treated as the assessee in default for the tax not deducted. Deductees may also complain if they cannot obtain credit, which damages supplier and staff relationships. VAT deducted at source is a separate obligation reported through the VAT system with Mushak 6.6 certificates, and should not be mixed into the income tax withholding return.

How the process works

1. Withholding diagnosticWe review your payment types, past challans and any returns already filed to find gaps.
2. Set up the registerA TDS register is built with deductee details, payment category, deduction and challan columns.
3. Periodic reconciliationBefore each filing we reconcile the register with bank statements and the general ledger.
4. Prepare and fileThe withholding return is prepared in the prescribed format and filed with the Taxes Circle or online system.
5. Issue certificatesCertificates of tax deducted are issued to employees and suppliers so they can claim credit.

Typical timeline: Setting up a clean withholding register usually takes one to three weeks; each periodic return then typically needs a few working days, depending on transaction volume.

How Tax & VAT Associates helps

• Withholding obligation review for your entity type and payment mix
• TDS register template and monthly reconciliation support
• Preparation and filing of withholding tax returns
• Salary and supplier TDS certificate preparation
• Correction of past challan and e-TIN errors where possible
• Notice response and hearing support for withholding issues

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.