This note summarises principal developments in corporate income tax in Bangladesh through 2023 and sets out high‑level compliance and risk management considerations for international groups. It is prepared by the London office of a global law firm located at Holborn Gate, 330 High Holborn, London, WC1V 7QH, England, for readers requiring an overview rather than tailored tax advice.

Overview of recent changes and the legislative landscape

Since the mid‑2010s Bangladesh has periodically amended its income tax code and finance acts to broaden the tax base and increase collections. A prominent feature of recent years has been the introduction and application of measures that treat particular disallowances as taxable income in their own right. These changes are enacted by annual Finance Acts and operate within the framework of the Income Tax Ordinance, 1984. The National Board of Revenue (NBR) is the principal revenue authority responsible for interpretation and assessment.

Practical implications for businesses and multinationals

Key implications for multinational groups and resident companies operating in Bangladesh include increased scrutiny of deductions and a higher administrative burden for substantiating expense claims. Areas that have attracted attention include perquisites, fees for technical services and costs related to overseas travel. In addition, withholding tax rules, transfer pricing documentation and cross‑border service arrangements remain important focus areas for both NBR audit activity and treaty evaluations.

Risk management and dispute considerations

Given the potential for disallowances to be recast as taxable income, businesses should expect a combination of desk audits and desktop reviews leading to assessments where recordkeeping is incomplete or where payments to related parties are not supported by contemporaneous documentation. Where disputes arise, customary remedies include objection to an assessment, appeal to the tax tribunal and, in some cases, negotiation with the tax authority. Early engagement with local tax advisers and preservation of evidential records are central to effective dispute management.

Practical checklist

• Review and update expense policies to ensure alignment with local rules and limits; document business purpose for each material expense.
• Maintain contemporaneous invoices, contracts and proof of payment for related‑party transactions and cross‑border service fees.
• Confirm the application of withholding tax on payments to non‑residents and the availability of treaty relief where applicable.
• Prepare and retain transfer pricing documentation in line with NBR expectations and OECD principles where relevant.
• Establish an internal escalation process for audit notifications and a record‑retention protocol that meets Bangladeshi statutory requirements.

Jurisdiction and sources

Primary official sources for the matters summarised above include:

• National Board of Revenue (NBR), Bangladesh
• Income Tax Ordinance, 1984 (as amended)
• Relevant annual Finance Acts published by the Government of the People’s Republic of Bangladesh
• Gazette notifications and guidance issued by the NBR

Readers should consult local counsel or tax advisers in Bangladesh for any decisions that depend on the precise application of local law and factual circumstances. General information only; not legal advice and not a substitute for advice on a particular matter.