June marks the end of the fiscal year, necessitating the completion of income tax calculations by this month. To avail tax rebates through investments, one must invest in designated sectors before June ends. The National Board of Revenue (NBR) has identified these sectors where investments can lead to tax rebates for taxpayers.
Approved Investment Sectors
The most straightforward and popular sector for investment is savings certificates, as they carry minimal risk and offer higher returns compared to bank deposits. Investments in banks or financial institutions up to BDT 10,000 per month also qualify for tax rebates. The NBR offers rebates on investments up to BDT 120,000 annually in DPS.
Investments in the stock market, including listed company shares, mutual funds, or debentures, also qualify for tax rebates. Government officers' provident fund contributions and recognized future funds also fall under the NBR's investment-related tax rebate list. Other sectors include life insurance premiums, welfare fund and group insurance fund contributions, superannuation fund contributions, and purchases of securities up to BDT 500,000.
Tax Rebate Calculation
The tax rebate is calculated as the lesser of three values: 0.3% of total income, 15% of total eligible investment, or a maximum of BDT 1 million. If the legal rebate amount exceeds the applicable tax on total income, no tax rebate will be granted. The rebate amount will never exceed the tax liability.
For taxpayers in Dhaka North City Corporation, Dhaka South City Corporation, and Chittagong City Corporation areas, the minimum tax payable is BDT 5,000. For other city corporation areas, it is BDT 4,000, and for areas outside city corporations, it is BDT 3,000.
