Bangladesh Personal Income Tax Guide (IIT)

Tax-Free Threshold (Tax-Free Minimum Income)

The basic tax-free threshold (tax rebate limit) varies by taxpayer category for the 2026 assessment year (income year 2025–26):

• Male taxpayer: BDT 300,000 (up from BDT 300,000 in prior years)
• Female taxpayer: BDT 350,000
• Senior citizen (65+): BDT 350,000
• Disabled individual: BDT 400,000
• Third gender (hijra): BDT 400,000
• Freedom fighter (muktijoddha): BDT 425,000
• Parents of disabled children: BDT 350,000

Income up to these thresholds is taxed at 0%. The threshold applies to the taxpayer's total annual income (salary, business, investments, etc.). For women and senior citizens, the additional BDT 50,000 over the male threshold reflects the government's policy of incentivising broader tax participation.

IIT Tax Brackets 2026 (Progressive Rates)

For a male taxpayer (basic threshold BDT 300,000), the progressive brackets on net taxable income are:

• 0% — on the first BDT 300,000 of taxable income
• 5% — on BDT 300,001 to BDT 500,000 (i.e., next BDT 200,000)
• 10% — on BDT 500,001 to BDT 1,000,000 (next BDT 500,000)
• 15% — on BDT 1,000,001 to BDT 1,500,000 (next BDT 500,000)
• 20% — on BDT 1,500,001 to BDT 2,000,000 (next BDT 500,000)
• 25% — on any amount exceeding BDT 2,000,000

The brackets shift by the threshold difference for other categories. For example, a female taxpayer with a BDT 350,000 threshold hits 5% at BDT 350,001 instead of BDT 300,001.

Investment Rebate (Tax Credit for Savings)

Taxpayers can claim a rebate (credit against tax payable, not a deduction) for qualifying investments, capped at the lower of:

• 15% of taxable income, or
• BDT 15,00,000 (15 lakh)

Qualifying investments include: Life insurance premiums, contributions to the Provident Fund (PF), investment in National Savings Certificates (NSC), shares of listed companies (initial public offerings), contributions to the Bangladesh Capital Market Stabilisation Fund, approved mutual funds, and investment in solar/hybrid power systems through approved channels.

The rebate rate depends on total taxable income: 15% of qualifying investment for income up to BDT 10,00,000; 10% for income between BDT 10,00,001 to BDT 20,00,000; and 5% for income exceeding BDT 20,00,000. Unused investment capacity cannot be carried forward.

Minimum Tax

All individual taxpayers must pay a minimum tax regardless of income level if they file a return:

• General taxpayers (Dhaka/City corporations): BDT 5,000
• Other areas: BDT 3,000
• Large taxpayers (company directors, high-income professionals): BDT 20,000 or higher as prescribed

The minimum tax is payable even if the computed tax liability is lower. This is designed to broaden the tax base and ensure all filers contribute a basic amount.

Surcharge on High-Net-Worth Individuals

Individual taxpayers with net wealth exceeding BDT 5 crore (5,00,00,000) at the end of the income year are subject to a 10% surcharge on their total income tax liability. This surcharge is computed before the investment rebate is applied and is in addition to the regular IIT. The surcharge rate increases progressively for higher wealth bands — up to 25% for net wealth exceeding BDT 50 crore. The surcharge applies to all categories of individuals (male, female, senior, disabled).

Filing Requirements

• Tax year: 1 July to 30 June (e.g., income year 2025–26, assessment year 2026–27)
• Filing deadline: 30 November (for individuals not subject to audit). For audit cases, 15 January.
• Online filing: e-TIN (Electronic Tax Identification Number) required for all filers. Returns filed via the NBR's online portal (নথি).
• Mandatory filing: Required if total income exceeds the tax-free threshold, if owning a motor vehicle, holding a credit card, operating a business, or being a company director.
• Penalties: Late filing BDT 1,000–5,000; failure to file attracts 25%–50% higher assessment.

FAQs

Can married couples file jointly?

Bangladesh does not permit joint filing. Each individual files a separate return. However, a wife's income may be aggregated with the husband's if both opt for the "aggregation of income" scheme (rarely used in practice).

How are foreign taxes on foreign income treated?

Bangladesh provides a foreign tax credit for taxes paid abroad on foreign-source income, limited to the average Bangladesh tax rate on that income. Double taxation agreements (DTAs) with over 30 countries may reduce or exempt certain income.

What is the e-TIN system?

e-TIN (Electronic Tax Identification Number) is the NBR's centralised online system for tax registration and filing. Every taxpayer must register for an e-TIN before filing. The system also provides for online return submission, tax payment, and certificate issuance.

Is there a wealth tax?

No separate wealth tax exists. However, the income tax surcharge on individuals with net wealth above BDT 5 crore functions as a quasi-wealth tax. See our Wealth Tax Guide for details.

Disclaimer

This guide provides general information about Bangladesh Individual Income Tax (IIT) for the 2026 assessment year. Tax laws and rates may change through the annual Finance Act. Always consult with a qualified tax advisor or the NBR directly for advice specific to your situation. InvestmentKit does not provide tax advice.