Tax

TDS rates with section references in Income Tax of Bangladesh for financial year 2018-19

August 28, 2018
TDS Rates 2018-19 Image

Do you know the updated TDS rates 2018-19 with section references?

Are you working in an accounts section and responsible for payment or collection of money? Then you have to know the updated TDS rates to deduct or collect tax at the time of payment or collection of money to comply Income Law of Bangladesh.

Last year, NBR had published a full list of TDS rates 2018-19 but this year yet no such list is published by the NBR.

I have updated the list based on the Finance Act 2018. After passing Finance Act 2018, I have published salient features of Finance Act 2018 in my last article in this website.

Anyway, there are few changes in the TDS rates in the financial year 2018-19.

In brief, the changes are discussed here and the details you will be presented below in table. And for your help, I have also included explanation in annexure.

So for more details, you may go in annexure following table.

This year the owner of the transport who has provided to ride sharing services like Uber, Pathao will get their earnings after deducting tax at the time of receiving their income under section 52AA. The TDS rates will be @ 3% where base amount does not exceed BDT 25 lakh but 4% where base amount exceeds BDT 25 lakh.

Under section 52Q the rate of TDS is 10% from any income in connection with any service provided to any foreign person by a resident person. But this year NBR has added, no tax against remittance on sale of software or services if it is exempted under paragraph 33 of part A of the sixth schedule.So you have to collect the list from the above reference.

TDS from manufacturer of soft drink, etc. under section 52S was deleted from this financial year. So no tax at source shall be applicable from this financial year 2018-19.

Payment on account of purchase through local L/C under section 52U TDS rate was applicable at a single rate @ 3%. But this year the TDS rates will be @ 3% and 1% if purchase of goods for the purpose of trading or reselling after process or conversion and payment against the invoice or sale of goods to distributor respectively.

Hope, you have understand all the changes are made through the Finance Act 2018 in TDS rates.

Now, let’s start for details TDS rates 2018-19 with section references.

Please rotate your smartphone screen for friendly view of the below table.

SI

Heads

Ref

Rate

1 Salaries Section 50 Average
Salaries (Government) Section 50 (1A) Average
2 Discount on the real value of Bangladesh Bank Bills Section 50A Maximum
3 Interest or profit on securities Section 51 5%
4 (a) Execution of contract, other than a contract for providing or rendering a service mentioned in any other section of Chapter VII.
(b) Supply of goods;
(c)Manufacture, process or conversion;
(d) Printing, packaging or binding
Section 52 & Rule 16 Annexure 1
5 Royalties, franchise, fee for issuing license, brand name, patent, invention, formula, process, method, design, pattern, know-how, copyright, trademark, trade name, literary or musical or artistic composition, survey, study, forecast, estimate, customer list or any other intangibles Section52A Annexure 2
6 (1) Advisory or consultancy service
(2) Professional service, Technical services fee, Technical assistance fee.
(excluding professional services by doctors)
Section 52AA Annexure 3
(2) Professional service (by doctors) Section 52AA Annexure 3
3.
(i) Catering service;
(ii) Cleaning service;
(iii) Collection and recovery service;
(iv) Private security service;
(v) Manpower supply service;
(vi) Creative media service;
(vii) Public relations service;
(viii) Event management service;
(ix) Training, workshop, etc. organization and management service;
(x) any other service of similar nature
(4) Media buying agency service
(5) Indenting commission
(6) Meeting fees, training fees or honorarium
(8) Credit rating agency
(9) Motor garage or workshop
(10) Private container port or dockyard service
(11) Shipping agency commission
(12) Stevedoring /berth operation commission
(13) Transport service, carrying service, vehicle rental service or ride sharing services
(14) Any other service which is not mentioned in Chapter VII, and is not a service provided by any bank, insurance or financial institutions
Section 52AA Annexure 3
(7) Mobile network operator, technical support service provider or service delivery agents engaged in mobile banking operations Section 52AA Annexure 3
7 C&F agency commission Section 52AAA 10%
8 Manufacturer of nonmechanical cigarette (Bidi) Section 52B 10% of the value of banderols
9 Compensation against acquisition of property Section 52C (a) 2% of the amount of such
compensation against the immovableproperty situated
within a city corporation, paurashava orcantonment board

(b)1% of the amount of such
compensation against the
immovableproperty situated
outside thejurisdiction of a city corporation, paurashava orcantonment board

10 Interest on saving instruments Section 52D 5%
(No witholding taxon interest on pensioners savings certificate if cumulative investment in suchcertificate at theend of the income year does notexceed tk. 5 lakh)
11 Payment to a beneficiary of Workers’ Participation Fund Section 52DD 5%
12 Brick Manufacturer Section 52F Tk.45,000/-for onesection brickfield,

Tk. 70,000/-for one and half section brick field,

Tk. 90,000/-for two section brick field,

Tk. 1,50,000/-for automatic brick field

13 Commission of letter of credit Section 52I 5%
14 Travel agent Section 52JJ Annexure 4
15 Renewal of trade license by City Corporation or Paurashava Section 52K Tk.500/-for DhakaNorth City
Corporation, DhakaSouth City Corporation &Chittagong City Corporation;

Tk. 300 for anyothercity corporation, and any paurashavaof any district
headquarters;

Tk. 100 in any other paurashava

16 Freight forward agency commission Section 52M 15%
17 Rental power Section 52N 6%
18 Foreign technician serving in diamond cutting Section 52O 5%
19 Services from convention hall, conference centre etc. Section 52P 5%
20 Any income in connection with any service provided to any foreign person by a resident person;

No tax against remittance on sale of software or services if it is exempted under paragraph 33 of part A of the sixth schedule.

Section 52Q 10%
21 International gateway service in respect of phone call. Section 52R (1)1.5%of totalrevenue received byIGW services
operator.

(2) 7.5% of revenue paid or credited toICX,ANS and others

(2A) 7.5% on the whole amount sopaid or credited at
the time of payment or credit

22 Payment in excess of premium paid on life insurance policy Section 52T 5%
23 Payment on account of purchase through local L/C Section 52U 3%
(If purchase of goods for the purpose of trading or reselling after process or conversion)

1%

(Payment against the invoice or sale of goods to distributor)

No tax shall be deducted
under this section from the
payment related to local
letter of credit (L/C) and any other financing agreement in respect of purchase or procurement of rice, wheat, potato, onion, garlic, peas,
chickpeas, lentils, ginger,
turmeric, dried chilies,
pulses, maize, coarse flour,
flour, salt, edible oil, sugar,
black pepper, cinnamon,
cardamom, clove, date,
cassia leaf, computer or
computer accessories, jute,
cotton, yarn and all kinds of fruits

24 Payment of fees, revenue sharing etc. by cellular mobile phone operator Section 52V 10%
25 Import Section 53 & Rule 17A (a) 5% (general rate)
(b) 2% on certain imported
goods
(c) Tk. 800 per ton in case of import of certain items
26 House property Section 53A 5% of the gross rent
27 Shipping business of a resident Section 53AA 5% of total freightreceived or receivable inor out of Bangladesh

3% of total freight received
or receivable from services
rendered between two or
more foreign countries

28 Export of manpower Section 53B & Rule 17C 10%
29 Export of knit wear and woven garments, terry towel, carton and accessories of
garments industry, jute goods, frozen food, vegetables, leather goods ,packed food
Section 53BB 1% of the total export
proceeds of all goods (other
than jute goods)

0.60%of the total export
proceeds of jute goods

30 Member of Stock Exchanges Section 53BBB 0.05%
31 Export of any goods except the goods mentioned in section 53BB Section 53BBBB 1% of the total export
proceeds of all goods except
the goods mentioned in
section-53BB
32 Goods or property sold by public auction Section 53C & Rule 17D 5% of sale price
33 Courier business of a non-resident Section 53CCC 15% on the amount of service charge
34 Payment to actors,actresses,producers, etc Section 53D (a)10% on the payment in
case of purchase of film,
drama, any kind of television
or radio program

(b)10% on the payment to
actor/actress(If the total
paymentexceedTk.10,000)

35 Export cash subsidy Section 53DDD 3%
36 Commission, discount or fees Section 53E(1) and (2) Annexure 5
37 Commission, discount or fees Section 53E(3) Annexure 5
38 Commission or remuneration paid to agent of foreign buyer Section 53EE 10%
39 Interest or share of profit on saving deposits and fixed deposits etc Section53F(1) 10% if there is TIN;

15% if there is no TIN (not
applicable if the balance does
not exceed tk. 1 lakh at any
time in the year in case of
saving deposit)

(not applicable on the amount
of interest or share of profit
arising out of any deposit
pension scheme sponsored by
the Government or by a
schedule bank with prior
approval of the Government)

Interest or share of profit on any saving deposits or fixed deposits or any term deposit by or in the name of a fund Section 53F(2) 5% (Annexure 6)
40 Real estate or land development business Section 53FF See annexure 7 incase of Building or apartment

In case of Land:
(i) 5% for Dhaka,
Gazipur,
Narayanganj,
Munshigang,
Manikganj, Narshindi
& Chittagong district;

(ii) 3% for any other
district

41 Insurance commission Section 53G 5%
42 Fees of survey or so for general insurance company Section 53GG 15%
43 Transfer of property Section 53H As mentioned in section 53H
44 Collection of Tax from lease of property Section 53HH 4%
45 Interest on deposit of post office Saving bank account Section 53I 10%
46 Rental value of vacant land or plant or machinery Section 53J 5% of the rent
47 Advertisement of newspaper or magazine or private television channel or private radio station or any web site or any person on account of advertisement or purchasing airtime of private television channel or radio station or such website. Section 53K 4%
48 Transfer of shares by the sponsor shareholders of accompany listed with stock exchange Section 53M 5%
49 Transfer of shares of any Stock Exchange Section 53N 15% on gain
50 Any sum paid by real estate developer to land owner Section 53P 15%
51 Dividends Section 54 Resident/nonresident
Bangladeshi
company —-
20%
Resident/nonresident
Bangladeshi
person other
than company
-If TIN, 10%
-If No TIN,
15%
52 Income from lottery Section 55 20%
53 Income of non-residents (Section 56):
(1) Advisory or consultancy service
(2) Pre-shipment inspection service
(3) Professional service, technical services, technical know-how or technical assistance
(4) Architecture, interior design or landscape design, fashion design or process design
(5) Certification, rating etc.
(6) Charge or rent for satellite, airtime or frequency, rent for channel broadcast
(7) Legal service
(8) Management service including event management
(9) Commission
(10) Royalty, license fee or payments related to intangibles
(11) Interest
(12) Advertisement broadcasting
(13)Advertisement making or Digital marketing
(14) Air transport or water transport
(15) Contractor or sub-contractor of manufacturing, process or conversion, civil
work, construction, engineering or works of similar nature
(16) Supplier
(17) Capital gain
(18) Insurance premium
(19)Rental of machinery, equipment etc.
(20) Dividend
(21) Artist, singer or player
(22) Salary or remuneration
(23) Exploration or drilling in petroleum operations
(24) Survey for oil or gas exploration
(25) Any service for making connectivity between oil or gas field and its export point
(26) Any payments against any services not mentioned above
Section 56 Annexure 8
(27) Any other payments under section 56 Section 56 30%
54 Advance tax for private motor car Section 68B Annexure9

Annexure 1: Rate of deduction under section 52

(a) subject to clause (b), in case of a payment made sub-section (1) of section 52, the deduction on payment shall be at the following rate:

SI Amount Rate
1 Where base amount does not exceed BDT 15 lakh 2%
2 Where base amount exceeds BDT 15 lakh but does not exceed BDT 25 lakh 3%
3 Where base amount exceeds BDT 25 lakh but does not exceed BDT 1 crore 4%
4 Where base amount exceeds BDT 1 crore but does not exceed BDT 5 crore 5%
5 Where base amount exceeds BDT 5 crore but does not exceed BDT 10 crore 6%
6 Where base amount exceeds BDT 10 core 7%

(b) the rate of deduction from the following classes of persons shall be at the following rate:

1 In case of oil supplied by oil marketing companies-
(a) Where the payment does not exceed taka 2 lakh

b) Where the payment exceeds taka 2 lakh

Nil

0.60%

2 In case of oil supplied by dealer or agent (excluding petrol pump station) of oil marketing companies, on any amount 1%
3 In case of supply of oil by any company engaged in oil refinery, on any amount 3%
4 In case of company engaged in gas transmission, on any amount 3%
5 In case of company engaged in gas distribution, on any amount 3%

Annexure 2: Rate of deduction under section 52A

Description of payment Rate
Where base amount does not exceed taka 25 lakh 10%
Where base amount exceeds taka 25 lakh 12%

Annexure 3: Rate of deduction from the payment of certain services under section 52AA

SI Description of service and payment Rate
Where base amount does not exceed Tk. 25 lakh Where base amount exceeds Tk. 25 lakh
1 Advisory or consultancy service 10% 12%
2 Professional service, technical services fee, or technical assistance fee 10% 12%
3 (i) Catering service;
(ii) Cleaning service;
(iii) Collection and recovery service;
(iv) Private security service;
(v) Manpower supply service;
(vi) Creative media service;
(vii) Public relations service;
(viii) Event management service;
(ix) Training, workshop, etc. organization and management service;
(x) any other service of similar nature-
(a) on commission or fee
(b) on gross bill amount
10%

1.5%

12%

2%

4 Media buying agency service
(a) on commission or fee
(b) on gross bill amount
10%

0.5%

12%

0.65%

5 Indenting commission 6% 8%
6 Meeting fees, training fees or honorarium 10% 12%
7 Mobile network operator, technical support service provider or service delivery agents engaged in mobile banking operations 10% 12%
8 Credit rating service 10% 12%
9 Motor garage or workshop 6% 8%
10 Private container port or dockyard service 6% 8%
11 Shipping agency commission 6% 8%
12 Stevedoring/berth operation commission 10% 12%
13 Transport service, carrying service, vehicle rental service, ride sharing services 3% 4%
14 Any other service which is not mentioned in Chapter VII of this Ordinance and is not a service provided by any bank, insurance or financial institutions 10% 12%

Annexure 4: Rate of deduction from income of non-residents under section 52JJ

Any person responsible for making any payment to a resident any sum by way of commission or discount or any other benefits, called by whatever name, convertible into money for selling passenger tickets or air cargo carriage shall deduct or collect advance tax at the rate of zero point three zero percent (0.30%) of the total value of the tickets or any charge for carrying cargo by air at the time of payment to such resident.

Where any incentive bonus, performance bonus or any other benefits, called by whatever name, is to be paid in relation to such sale of tickets or bill for carrying cargo by air in addition to the amount mentioned in sub-section (1), person responsible for making such payment shall deduct an amount equal to (A/B) x C, where:

“A” is the amount of incentive bonus, performance bonus or any other benefits as mentioned in sub-section (2),

“B” is the amount of commission or discount or any other benefits as mentioned in subsection (1), and

“C” is the amount of source tax on commission or discount or any other benefits as mentioned in sub-section (1).

For the purpose of computation of value of tickets or charge, any payment made in respect of any embarkation fees, travel tax, flight safety insurance, security tax and airport tax shall not be included in such value or charge.

“payment” includes a transfer, a credit or an adjustment of payment.

Annexure 5: Rate of deduction from income of non-residents under section 53E

(1) Any company making a payment or allowing an amount to a distributor, called by whatever name, or to any other person by way of commission, discount, fees, incentive or performance bonus or any other performance related incentive or any other payment or benefit of the similar nature for distribution or marketing of goods, shall deduct or collect tax at the time of payment or allowing the amount at the rate of ten percent (10%) of the amount of payment or the amount allowed or the value of benefits allowed, as the case may be.

(2) Any company making a payment in relation to the promotion of the company or its goods to any person engaged in the distribution or marketing of the goods of the company shall, at the time of payment, deduct tax at the rate of one point five percent (1.5%) of the payment.

(3) Any company, other than an oil marketing company, which sells goods to:
(a) any distributor, or
(b) any other person under a contract,

at a price lower than the retail price fixed by such company, shall collect tax from such distributor or such any other person at the rate of five percent (5%) on the amount equal to B x C,

where B = the selling price of the company to the distributor or the other person;
C = 5%:

Provided that a cigarette manufacturer company shall collect tax at the time of sale of its goods to such distributor or to such other person at the rate of three percent (3%) of the difference between the sale price to the distributor or the other person and the retail price fixed by such company.

(4) In this section:
(a) “payment” includes a transfer, credit or an adjustment of payment;
(b) “contract” includes an agreement or arrangement, whether written or not.

Annexure 6: Rate of deduction from income of non-residents under section 53F (2)

TDS @ 5% is applicable on profit or share of profit.

The responsible person who will paid or credit, earlier one, profit or share of profit on savings deposit, fixed deposit or term deposit by Fund or Name in any schedule bank, cooperative bank, bank operated under IslamiShariah, non-banking finance institute, leasing company or house finance company shall deduct the tax at the above rate.

Fund means approved superannuation fund, pension fund, gratuity fund, recognized provident fund or workers’ participation fund which is created and operated by law has a legal identity and can operate separate bank account under law.

The above rate will be applicable from July 01, 2016.

However, the fund which was exempted from source tax shall enjoy the facility upto June 30, 2016.

Annexure 7: Rate of deduction from income of non-residents under section 53FF

  1. a) in case of building or apartment constructed for residential purposes:
Area Per square metre (BDT)
i) Gulshan Model Town, Banani, Baridhara, Matijheel C/A and Dilkusha C/A of Dhaka 1,600
ii) Dhanmondi R/A, DOHS, Mohakhali, Lalmatia Housing Society, Uttara Model Town, Bashundhara R/A, Dhaka Cantonment Area, Karwanbazar C/A of Dhaka and Panchlaish R/A, Khulshi R/A, Agrabad and Nasirabad of Chittagong 1,500
iii) Dhaka North City Corporation, Dhaka South City Corporation and Chittagong City Corporation other than areas mentioned in (i) and (ii) 1,000
iv) Other City Corporations than Dhaka North City Corporation, Dhaka South City Corporation and Chittagong City Corporation 700
v) in areas other than areas mentioned in the above (i), (ii), (iii) & (iv) 300

Source tax for residential apartment consisting below 70 sqm including common space will be 20% lower and below 60 sqm including common space will be 40% lower.

  1. b) in case of building or apartment or any space constructed not for the residential purposes:
Area Per square metre (BDT)
i) Gulshan Model Town, Banani, Baridhara, Matijheel C/A and Dilkusha C/A of Dhaka 6,500
ii) Dhanmondi R/A, DOHS, Mohakhali, Lalmatia Housing Society, Uttara Model Town, Bashundhara R/A, Dhaka Cantonment Area, Karwanbazar C/A of Dhaka and Panchlaish R/A, Khulshi R/A, Agrabad and Nasirabad of Chittagong 5,000
iii) Dhaka North City Corporation, Dhaka South City Corporation and Chittagong City Corporation other than areas mentioned in (i) and (ii) 3,500
iv) Other City Corporations than Dhaka North City Corporation, Dhaka South City Corporation and Chittagong City Corporation 2,500
v) in areas other than areas mentioned in the above (i), (ii), (iii) & (iv) 1,200

Annexure 8: Rate of deduction from income of non-residents under section 56

SI Description of services or payments Rate
1 Advisory or consultancy service 20%
2 Pre-shipment inspection service 20%
3 Professional service, technical services, technical know-how or technical assistance 20%
4 Architecture, interior design or landscape design, fashion design or process design 20%
5 Certification, rating etc. 20%
6 Charge or rent for satellite, airtime or frequency, rent for channel broadcast 20%
7 Legal service 20%
8 Management service including event management 20%
9 Commission 20%
10 Royalty, license fee or payments related to intangibles 20%
11 Interest 20%
12 Advertisement broadcasting 20%
13 Advertisement making or Digital marketing 15%
14 Air transport or water transport 7.5%
15 Contractor or sub-contractor of manufacturing, process or conversion, civil work, construction, engineering or works of similar nature 7.5%
16 Supplier 7.5%
17 Capital gain 15%
18 Insurance premium 10%
19 Rental of machinery, equipment etc. 15%
20 Dividend-
(a) company–
(b) any other person, not being a company–
20%

30%

21 Artist, singer or player 30%
22 Salary or remuneration 30%
23 Exploration or drilling in petroleum operations 5.25%
24 Survey for oil or gas exploration 5.25%
25 Any service for making connectivity between oil or gas field and its export point 5.25%
26 Any payments against any services not mentioned above 20%
27 Any other payments 30%

Annexure 9: Rate of advance tax under section 68B

SI Types of car and engine capacity BDT
1 Upto 1500cc motor car or jeep 15,000
2 More than 1500cc to 2000cc motor car or jeep 30,000
3 More than2000cc to 2500cc motor car or jeep 50,000
4 More than2500cc to 3000cc motor car or jeep 75,000
5 More than3000cc to 3500cc motor car or jeep 100,000
6 Above 3500cc motor car or jeep 125,000
7 For each microbus 20,000

In case of more than one car or jeep solely or jointly owned by any person then the advance tax will be 50% higher for each next car or jeep.

The advance tax shall be paid at the time of registration or before expired date of fitness renewal.

The responsible authority who will issue the registration or fitness renewal certificate should confirm that the advance tax has been paid for respective motor car, jeep or microbus.

Where the fitness renewal is not required in each year then the advance tax shall be paid before the expired date of financial year. And the payment receipt of advance tax shall be submitted at the time of next renewal date.

The tax paid as advance shall be adjusted as credit but non refundable or will not adjusted in next income year.

If regular tax is less than advance tax then the advance tax shall be treated as minimum tax.

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8 Comments

  • Reply Monira Hossain September 24, 2018 at 6:22 PM

    In case of FDR/ any deposit of 1 Lac of a non TIN holder, what will be the source tax? 10% or 15% as after interest application principal goes higher than 1 Lac?

  • Reply Sohel Rana November 10, 2018 at 10:36 AM

    15%

  • Reply Saiful Islam November 27, 2018 at 10:03 PM

    15%

  • Reply Khalid Bin Shahid December 19, 2018 at 11:25 AM

    Rate will be 15% for any amount in case of non holder of 12 digit TIN

  • Reply Mahbubur Rahman January 20, 2019 at 4:28 PM

    Very Nice , I need it .Thank You Bhaiya .

  • Reply bappi January 22, 2019 at 10:45 PM

    Entertainment expense and ITES ( information technology enable service) ar upor TDS and VDS rate koto hoba 2018-19 a

  • Reply Imtiaz January 29, 2019 at 9:13 AM

    Please tell me the TDS rate for sponsorship?

  • Reply Liton Mrong February 8, 2019 at 12:41 AM

    Dear Sir,
    Thanks with gratitude for your effective cooperation in this regards.

    With best complements,

    Liton Mrong

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