Investment Plan for Tax Rebate

You will get a Tax Rebate on Eligible Investment if invested within 30 June 2023.

When considering investments, it is important to note that tax considerations should not be the sole basis for an investment strategy. However, it is still prudent to explore opportunities to manage, defer, and reduce taxes.

Amount of allowable investment is –

actual investment or

20% of total (taxable) income or

Tk. 1,00,00,000/- whichever is less.

Tax rebate amounts to 15% of allowable investment.

Types of investment qualified for the tax rebate are:

• Life insurance premium up to 10% of the face value.
• Contribution to Provident Fund to which Provident Fund Act, 1925 applies.
• Self contribution and employer’s contribution to Recognized Provident Fund.
• Contribution to Superannuation Fund.
• Contribution up to TK 60,000 to deposit pension scheme sponsored by any scheduled bank or a financial institution.
• Investment in approved debenture or debenture stock, Stocks or Shares.
• Any investment by an individual in savings certificate and Bangladesh Government Treasury Bond.

Donation or Contribution:

• Contribution to Benevolent Fund and Group Insurance premium.
• Contribution to Zakat Fund.
• Donation to charitable hospital approved by National Board of Revenue.
• Donation to philanthropic or educational institution approved by the Government.
• Donation to socio-economic or cultural development institution established in Bangladesh by Aga Khan Development Network.
• Donation to ICDDRB.
• Donation to philanthropic institution-CRP, Savar, Dhaka.
• Donation up to tk. 5 lac to
  1. Shishu Swasthya Foundation Hospital, Mirpur, Shishu Hospital, Jessore and Hospital for Sick Children, Sathkhira run by Shishu Swasthya Foundation, Dhaka.
  2. Diganta Memorial Cancer Hospital, Dhaka.
  3. The ENT and Head-Neck Cancer Foundation of Bangladesh, Dhaka and
  4. Jatiya Protibandhi Unnayan Foundation, Mirpur, Dhaka.

• Donation to Dhaka Ahsania Mission Cancer Hospital.
• Donation to Sylhet Diabetic Samity, Islamia Eye Hospital and MA Ispahani Institute of Opthalmology, Kidney Foundation and National Heart Foundation of Bangladesh.
• Donation to Asiatic Society of Bangladesh.
• Donation to Muktijodha Jadughar.
• Donation to National level institution set up in memory of liberation war.
• Donation to National level institution set up in memory of Father of the Nation.

Common investment options for individuals include life insurance policies, Provident Funds, and equity-linked savings schemes. As per the NBR, the allowable investment for tax rebate is either the actual investment amount or 30% of total taxable income or BDT 15 million, whichever is less. The tax rebate amounts to 15% of the allowable investment.

Government savings certificates or treasury bonds are viable investment options that individuals can consider. Some financial institutions offer tax-exempt pension funds, which can also be advantageous. It is worth exploring these alternative investment options in addition to traditional ones. For example, the principal component of a home loan’s Equated Monthly Installment (EMI) qualifies for a tax rebate. By considering these available options, individuals can significantly reduce their tax payments.