File returns timely, avoid penalty

Bangladesh has roughly 60 lakh registered taxpayers. And if you are registered with a taxpayer identification number (TIN), it is high time for you to prepare and file your returns of incomes, no matter whether you have taxable income or not.

And you have less than 15 days to accomplish the task as the deadline for furnishing income returns is November 30. Because from December 1, you will face a 2 per cent monthly fine on the payable amount of tax for delayed submission.

However, this is not the only hassle that you have to face.

You will have to apply with your respective tax office to be granted additional time for filing returns and later collect the approved application. That means you will have to go to the tax office twice or thrice to finish the task of filing your annual income, expenditure and wealth statement.

In addition, you may miss this opportunity to avail a festive environment and cordial attitudes of taxmen at the tax office once the official deadline expires.

"So the best way is to file returns within the deadline," said Md Mohidul Islam Chowdhury, second secretary of tax policy at the National Board of Revenue (NBR).

He said the 2 per cent fine would not be a small amount for taxpayers whose incomes come from sole proprietorship firms. Taxpayers who have fixed deposits are likely to bear a higher penalty for their failure to submit returns within the regular period.

And in case anyone fails to apply for time, the person will face higher scrutiny by taxmen: returns will go through a hearing at the tax office before assessment.

This will require taxpayers to visit tax offices several times and face associated hassles, he said.

A senior NBR official seeking to remain unnamed, said a good number of taxpayers can avail an opportunity of filing their income tax returns online from this year.

As per rules, all TIN holders are required to file tax returns irrespective of their income status.

"We have found that nearly 40 lakh TIN holders will not need to pay any tax as they do not have taxable income. They can file their returns online easily," he said.

"The job can be done through a few clicks and taxpayers do not need to visit tax offices," he added.

The TIN holders will only need to sign up with their registered mobiles for filing returns.

He said online filing would be convenient for taxpayers who do not face tax at source.

Online returns submissions will enable taxpayers to download acknowledgement receipts any time throughout the year, he said, adding that taxpayers would be able to pay tax online through the newly developed system.

Public sector employees are also expected to find the system to be easier for them when filing returns this year, added the official.

Taxpayers will not need to visit tax offices for these documents, he added.

Jasim Uddin Rasel, who follows tax matters, said submission of tax returns was a prerequisite for avoiding penalties.

"If any person fails to file returns without a reasonable cause, he shall be guilty of an offence punishable with imprisonment for a term up to one year, or with fine, or with both," he said citing tax rules.

He said in case of a new individual whose taxes had not been previously assessed, the penalty faced may go up to Tk 5,000.

But for taxpayers whose taxes and incomes were assessed previously, they may be required to pay a penalty of 50 per cent of the tax payable on the last assessed income or Tk 1,000, whichever is higher, said Rasel.