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SAM

Published:
2018-06-11 09:27:45 BdST

Companies to face fines over failure to submit staff's tax info


FT ONLINE

Employers may have to pay a fine, equivalent to 10 per cent of their total payable tax or Tk 5,000, whichever is higher, for their failure to furnish the tax payment details of their employees.

The Finance Bill 2018 includes the new provision, proposed to be introduced from the upcoming fiscal year (FY), 2018-19.

The companies' tax files will also come under mandatory auditing process, if they fail to provide the tax payment information of their employees.

The salaried taxpayers have to furnish their respective tax return-related statements to their employers, according to the income tax law.

As per the Finance Bill 2018, every employee will have to furnish three types of information to their employers by 15th April of every year.

The information include Taxpayers Identification Number (TIN), the date of filing income tax return, and the serial number provided by the authority concerned upon filing of the return.

The employers have to submit a statement to the tax authority by 30th April of every year on the basis of information provided by their employees.

A senior NBR official said the tax measures will help the government increase collection of the payroll tax.

"Tax return submission by the salaried persons will go up in the next FY," he said.

The employers will be held responsible for non-compliance on the part of their respective employees, he added.

In the outgoing FY, the NBR made furnishing the employees' tax return information mandatory for the employers.

The employer companies will not be able to claim the salary paid to their employees as expenditure in their tax files unless they furnish the employees' tax information.

Former President of the Bangladesh Employers Federation (BEF) Md Fazlul Hoque hailed the initiative to ensure tax compliance.

He, however, said the imposition of penalty on the employers is unjust.

"Every individual is responsible for filing his/her respective tax return. The employers can help the tax authority to enforce the law."

Collecting the tax return information of the employees, in some cases, can be time-consuming, he added.

The proposed finance bill for the FY 2019 also raised the amount of penalty ten times for the corporate taxpayers in case of their failure to submit half-yearly withholding tax returns.

They will also have to pay ten times higher penalty for failure in issuance of at-source tax deduction certificates, according to the budget proposal.

The companies will have to furnish statements relating to the withholding tax deduction to the tax authority to avoid higher penalty.

The penalty for the businesses may also rise by 10 per cent, if they fail to display TINs on their respective premises.

According to the Income Tax Ordinance 1984, all the businesses have to display their TIN certificates on their respective business premises.

The companies may also have to count higher penalty, if they fail to submit the statements of withholding tax deduction from interest amount, profit and dividend income.

In case of continuous failure, the employers/companies may have to count penalty amounting to Tk 1,000 for each month.

As of now, the penalty for such non-compliance is Tk 500 for each case.

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