Corporate payroll in Bangladesh requires more than disbursing monthly salaries. Employers bear statutory legal responsibility under Section 86 of the Income Tax Act 2023 to deduct tax at source (TDS) from employees earning above taxable thresholds and remit it to the government treasury.
Employer Penalty: Failure to deduct or deposit employee salary tax results in personal liability for company directors, plus statutory interest and disallowance of total salary expenses.
Monthly Payroll Compliance Workflow
- Calculate individual employee taxable salary, factoring in basic salary, housing, and medical allowances.
- Deduct monthly income tax installment based on applicable personal slab rates.
- Disburse net salaries strictly through recognized banking channels or digital financial services (MFS).
- Deposit deducted tax to the government treasury via Treasury Challan within statutory deadlines.
- Issue monthly payslips and annual salary tax deduction certificates (Section 86) to employees.
Annual Form 108 Employer Filing
Every corporate employer must submit an annual return of salary payments (Form 108) to the tax authority detailing total compensation paid and tax deducted for every employee during the income year.
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Regulatory Notice: This compliance guide is for general educational information only under Bangladeshi statutory frameworks (including the Income Tax Act 2023, Value Added Tax and Supplementary Duty Act 2012, and Companies Act 1994) and does not constitute formal legal or tax counsel. Government gazette rules, statutory regulatory orders (SROs), and procedural circulars are subject to periodic administrative updates. Please consult an EasyTax advocate or tax practitioner for customized advisory on your specific situation.
