TCF Monthly Newsletter - November 2022
Tokyo Consulting Firm Bangladesh
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ACCOUNTS & TAXATION
Advance Payment of Tax
Overview
Advance tax is the amount of income tax that should be paid much in advance instead of lump-sum payment at the year-end in installments as per the due dates given by the income tax department
Persons Responsible for Payment of Advance Income Tax:
Old Assessee - Based on the latest provisional or regular assessment but not under S. 93 (income escaping assessment) if income assessed at least Tk. 600,000.
New Assessee- If the new assessee's total income, excluding capital gain and agricultural income, exceeds Tk. 600,000 he/she is supposed to pay advance income tax but not (mandatory).
Every person required to file a return on regular basis shall pay advance tax.
Payment Criteria of Advance Tax
If the new assessee's total income, excluding capital gain and agricultural income, exceeds Tk. 600,000 he/she is supposed to pay advance income tax. Computation of advance tax payable in case of new taxpayers is based on the estimated total income applied at regular rates as reduced by the amount of tax required to be deducted or collected at the source?AIT shall be payable in four equal installments on the 15th day of September, December. March, and June of the financial year for which the tax is Payable.
Advantages of Advance Tax
If the amount of advance tax paid is in excess of the amount of tax payable as determined on regular assessment. The Government shall pay simple interest at 10% per annum on such excess payment.
Disadvantages of Advance Tax
If an assessee has paid advance tax but paid (including TDS) less than 75% of the amount of tax payable by him as determined on regular assessment, the assessee shall pay simple interest at 10% per annum on the amount by which the tax so paid and deducted falls short of the 75% of the assessed tax.?If an assessee fails to pay any installment of advance tax on the due date, he shall be deemed to be an assessee in default in respect of such installment. Where, it is found that advance tax has not been paid accordingly simple interest @ 10% will be added with tax liability for the period from the 1st July of the year in which the AIT was paid to the date of regular assessment in respect of the income of that year or a period of two years from the said 1st July, whichever is shorter.?
Reference
i) ITO 1984 (sec 64-74).
HUMAN RESOURCE
Worker Regulations While Transferring a Factory, Ownership, or Shareholdings
Generally, the workers and owner build a relationship for mutual interest based on a contract or appointment. Sometimes organization passes crucial situations due to natural disasters or other harmful conditions, and it faces difficulties running production. Finally, the owner may have to decide to transfer entire equities, i.e., factory, enterprise, or share. If the owner wants to transfer the ownership, in this regard, before closing the business, they must follow some procedures for the existing workers and their welfare as per Bangladesh Labour Rules, 2015. The Labour Ministry has made some significant amendments to these rules (while transferring ownership of shares) on 1st September 2022, which are enumerated underneath
(C) In case of transferring Factory, Ownership, and Share
(i) If workers want to continue the work in transferred factories or enterprises, then those workers can continue their work;
(ii) If the workers are not interested in continuing works with transferred factories or enterprises, they shall be eligible to get the benefits as per 27(4) of the Bangladesh Labour Act 2006;
(iii) If the new owner does not want to take the liability of workers before the transfer of ownership, the previous owner shall terminate the workers and shall provide due payment under Section 20 of Bangladesh Labour Act 2006;
(iv) In case of any due payment, if there is no agreement between the new and previous owner, then the new owner of the factory or enterprise shall take all liabilities;
(v) If there is any dispute during the payment of dues between the previous and new owners, they will pay as per section 124A (Payment of wages and other dues through conciliation) or discuss with Trade Union (If any) of the related enterprise;
(vi) The new owner shall inform all issues of transfer to the Inspector General or related acting Inspector within 7(Seven) days by producing notice;
(D) In case of stopping production permanently and transferring ownership, the Inspector General or such acting Officer must be informed as per Form 10.
Reference
Responsibilities of Paying the Wages to the Employees/Workers
In any factory or establishment where a production-related job is running, the employees or workers give their labor for producing the goods and services or adding value and the owners or employers give salary in exchange for labor. Since the workers or employees are appointed in various ways, the responsible parties of paying salary/wages are also different.
Responsibility for Payment of Wages
Employer: Generally, every employer shall be liable to pay all wages required to be paid to workers employed by him under Bangladesh labor Act 2006.
?And provided that in the case of all other workers, except any worker employed by a contractor, the Chief Executive Officer, the Manager, or any other person responsible to the employer for the supervision and control of an establishment shall also be liable for such payment.
In the Case of Employment by a Contractor
For the employees or workers who are appointed by the contractor, it is the contractor’s responsibility to pay them wages to them.
But if the wages of workers employed by the contractor and if the contractor does not pay the wages to his workers, then the wages of such workers shall be paid by the employer of the establishment, and the same shall be adjusted from the contractor by the employer of the same establishment.
Time of Payment of Wages
The wages of a worker shall be paid before the expiry of the 7 (Seventh) working day following the last day of the wage period. All wages shall be paid on a working day.
Reference
i.???Bangladesh Labor Act-2006, Section-121 & Section-123
LEGAL & SECRETARIAL
Foreign Exchange Regulation for Outbound and Inbound Travelers
With the passage of time, the economy and per capita income of people is growing. Foreigners are also doing several kinds of business in Bangladesh. Due to globalization, the volume of borderless transactions has been increasing. To control foreign transactions Bangladesh Bank has composed Guidelines for foreign exchange transactions. In this article, some scenarios are highlighted which are necessary for individuals.
From time-to-time Bangladesh, bank adds and amends and updates its guidelines to ease and balance the control of foreign exchange transactions. The above-mentioned scenarios are the most frequently required for individuals who are involved in foreign transactions.?This article will assist an individual to provide a basic idea about frequently required foreign exchange rules.
Referance
i.???Guideline for Foreign Exchange Transaction 2009 (volume 1) [www.bb.org.bd]
ii.???Foreign Exchange Declaration Form?2020 February 11
?????"https://www.bb.org.bd/mediaroom/circulars/fepd/feb112020fepd08e.pdf