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The Financial Express

Proof of tax return submission

Start-ups to get relief for two years

| Updated: July 01, 2022 17:19:59


Start-ups to get relief for two years

Start-up companies will get relief from submission of proof of tax return for two consecutive years to avail different services, according to a new provision in the Finance Act-2022.

The National Board of Revenue (NBR) has relaxed the provision of mandatory submission of tax return slips for the newly registered companies with the Registrar of Joint Stock Companies and Firms (RJSC), in order to facilitate ease of doing business.

A senior tax official said a newly registered company would enjoy the facility for the year it gets registered with the RJSC and the corresponding year.

"We have relaxed the rule considering compliance requirements for corporate taxpayers that need time to comply," he said.

A corporate taxpayer requires submitting an audited financial statement which should be verified through the Document Verification System (DVS), developed by the Institute of Chartered Accountants of Bangladesh (ICAB), he further said.

New corporate taxpayers will be deprived of different services in case of delay in preparing necessary documents for submission of tax returns, he added.

In the Budget for FY 2022-23, the NBR made submission of tax return slip mandatory for both corporate and individuals to avail different services.

However, existing corporate taxpayers and individuals have to comply with the provision of the Finance Act-2022.

Hailing the measure to ease the ease of doing business for start-ups, Dhaka Chamber of Commerce and Industry (DCCI) President Rizwan Rahman urged a simplified process of corporate tax return submission so that companies could meet compliance requirements of tax authorities.

Mr Rahman also laid emphasis on monitoring the financial transactions of start-ups to check any abuse of the facility.

Talking to the FE, a number of field-level tax officials said the mandatory rule for submission of tax return slips should be relaxed for some categories of individuals too, including senior citizens and housewives.

Bank transactions would be suspended in case of non-submission of return slip every year if the balance of bank deposits exceeds Tk 1.0 million.

Such tricky rules may hurt the rural people receiving remittances from expatriates, the officials said.

In the Finance Act, the tax authority made a flat rate of tax at source 10 per cent reducing it from the proposed 12 per cent.

The NBR, for the first time, incorporated the mandatory rules on submission of tax returns for availing all types of major services.

Tax officials said a poor number of tax return submissions, 2.4 million, and Taxpayers Identification Number (TIN), around 7.5 million, in the country of 160 million compelled the NBR to make the rule mandatory.

Submission of e-return will help taxpayers comply with the mandatory provision, they said.

Officials said the number of tax returns would be jumped by manifold this year banking on the fiscal measure for FY 2022-23.

The NBR is often being blamed for its failure on the slow rise of the number of tax returns despite having mandatory provision that everyone having TIN must have to submit tax returns, added the officials.

Suspension of public and private services for people not submitting tax returns will force many people to come under tax net in the upcoming FY, they noted.

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