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Course Objectives
This course is designed to achieve following objectives. These are to
a. provide a basic knowledge in principles of taxation and tax laws
b. understand various aspects of fiscal statutes and its practical applications
c. assess tax, VAT etc.
d. know how to try prepare plan for tax
Income tax -Weight-60%
204.01 Theory on Taxation:
Meaning of Tax, Features and Purposes of Tax, Principles of Taxation, Classification of Taxes, Characteristics of a Good Tax System, Tax Structure in Bangladesh.
204.02 Income Tax:
Introduction to Income Tax:
Income Tax – Meaning, Nature, Importance in respect of Contribution to Internal Resource Mobilization – Historical Perspective of the Income Tax Ordinance, 1984 – Statutory Definitions of Important Terms.
Income Tax Authority:
Administrative and Judicial – appointment, organization structure, power and functions – Taxes Appellate Tribunal – Registered Income Tax practitioner.
Charge of Income Tax:
Basic Principles, Systems (Conventional Exemption Limit versus Filing Threshold) – Sources of Income Tax Laws.
Computation of Total Income:
Scope of Total Income on the basis of Assessee’s Residential Status – Income deemed to accrue or arise in Bangladesh – Deemed Income (unexplained investment etc.) – Non – Assessable Income – Income under Specific Heads.
Salaries: Definition, coverage, benefits and perquisites, provident fund.
Interest on Securities: Coverage, grossing up, deductions, exclusion limit.
Income from House Property: annual value, coverage, deductions, Tax holiday and exemption limit for newly constructed residential houses.
Agricultural Income: Agriculture assets, deductions, set-off and carry forward of agricultural losses.
Income from Business or Profession: definitions, Capital and revenue expenditures, coverage, partially business income, admissible and inadmissible expenses, depreciation on business property (normal, extra, initial, accelerated and special), set-off and carry forward of business losses and losses in speculation business.
Share of Income from Firms.
Income of Spouse or Minor Child.
Capital Gains: definitions, computation, exempted capital gains, set-off and carry forward of losses under “Capital Gains”.
Income from Other Sources: Coverage (dividend, interest on securities, royalty, fees for technical services, etc.), deductions, Clubbing of Income.
Foreign Income.
Procedure of Assessment:
Filing of return of income and supporting Statements. Assessment of Tax - Provisional Assessment and Final Assessment (Correct return basis, after-hearing basis, and ex-parte) – Other issues in assessment, self-assessment, presumptive assessment, assessment for outgoing persons and deceased persons, assessment of escaped income, limitations of assessment, reopening of assessment.
Rates of Taxes:
Tax Rate on Capital gains and income from winnings – Tax rate on other income of individuals, firm and companies – Tax Rate on non-residents income, imposition of Surcharge.
Investment Tax Credit and Tax Rebate.
Payment, Refund and Recovery:
Modes of Tax payment: Tax deducted at source (TDS) or pay-as-you-earn (PAYE), Advance payment, Payment on the basis of return, Adjustments with other taxes paid, and Payment on notice of demand, Tax Recovery, Tax Refund, Tax Relief.
Assessments of Individuals, Firms, Association of Persons, and Cooperative Societies:
Assessment covering all heads of income – Set-off and carry forward of losses by firm’s and partner’s income including income other than firm’s income – Allocation firm’s income – Assessment in case of change in firm’s constitution and in case of constitution of new successor firm.
Corporate Taxation:
Definitions – Determination of Total Income – Rates and Rebates – Classification of Companies according to Income Tax Law – Assessment of various types of companies including bank and insurance companies and companies engaged in extraction and exploration of mineral resources – Corporate fiscal incentives.
Provident, Superannuation, Pension and Gratuity Funds:
Kinds of Provident Funds (PF) – Statutory: General & Contributory; Recognized and Unrecognized – privileges of Recognized PF – Approved Superannuation, Pension and Gratuity Funds.
Liabilities in Special Cases:
Liabilities of representatives, agents, firms, association of persons, partners, company directors, liquidators, etc.
Appeals, Revision and References:
Appeal and or Revision against DCT, Tax Recovery Officer (TRO) – Decision of appeal by AJCT, Taxes Appellate Tribunal, High Court Division and Appellate Division.
Miscellaneous Issues:
Offence and Prosecution – Methods of Accounting – Double Taxation Relief-Tax Avoidance-Bond Washing Transactions. Tax-holiday and Tax-exemption Scheme: Industrial undertakings – Tourist Industries – Objectives and Importance of the Scheme – Accelerated Depreciation – Tax Audit and Investigation.
Property -Weight-10%
204.03 Property Taxation:
Property-related Tax under Income Tax Laws: (i) Income tax on initial investment in some property to avoid the question as to the source of income or to make the investment tax-exempted; (ii) Tax on notional income for ownership of some property; and (iii) Capital gains tax on transfer of property.
Gift Tax : Charge of Gift Tax – Taxable Gifts – Exemptions from Gift-tax-Determination of the value of Gifts – Return of gifts – Gift – Tax payable – Penalty – Prosecution – Assessment procedures – Rates – Authorities.
Indirect tax -Weight-20%
204.04 Indirect Taxation
Border Taxes
Objectives of Customs Act – Customs Procedure – Statutory Definitions of Important Terms – Duties under the Customs Act 1969 [General Customs Duty (import/export duty), Regulatory Duty, Countervailing Duty, Anit-dumping Duty, and Safeguard Duty] – Rates of Duties – Duties, Taxes and Other Charges Collected by Customs Authority at Import Stage [Customs Duty (CD), Supplementary Duty (SD), Value Added Tax (VAT), Infrastructure Development Surcharge (IDSC) and Advance Income Tax (AIT)- Computation of Duties and Taxes at Import Stage – Duty Drawback – Customs Authority – Assessment, Appeals and Revision – Offences and Penalties – Power of Search, Seizure and Arrest under the Customs Act – Travel Tax on Foreign Tours – Baggage Rules and related taxes.
Value Added Tax (VAT)
Concepts, Advantages and Disadvantages, Arguments for and against VAT, Computation of VAT Act in Bangladesh; Obligation of taxpayers under the VAT laws – Registration, Enlistment for Turnover Tax or Enlistment for Cottage Industry – Payment of VAT – Submission of Return – Maintenance of Books of Accounts and Records – VAT Audit – Offence and Penalties – Confiscation – Appeals and Revisions – Recovery of claim – VAT Refund.
Other Taxes
Excise duty, Objectives, Current coverage of excise taxation – Tax collectors, Narcotics duty, Current coverage of excise taxation – Tax collectors, .
Tax Planning -Weight-10%
204.05 Tax Planning:
Tax evasion, Tax avoidance, and Effective Tax planning – Prerequisite to Effective Tax Planning (All Parties, All Taxes, and All Costs) – Taxing Authority as an Uninvited Investment Partner – Influence of Tax Rules on Investment, Financing and Dividend Decisions – Types of tax planning, Importance of Tax Planning – Restriction on taxpayer behavior – Tax Arbitrage – Tax Clientele.
Suggested Readings:
1. The Income Tax Ordinance 1984 and the Income Tax Rules 1984 (updated).
2. The Customs Act 1969.
3. The Value Added Tax Act 1991 updated.
4. The Excise and Salt Act 1944 updated
5. The Gift-tax Act 1990 updated.
6. The Finance Acts (Latest).
7. Summary of Taxation Rules in Bangladesh - MCCI, Dhaka).
8. Corporate Tax Planning - Lakhotia, R. N. , and S. Lakhotia, 1998 (New Delhi: Vision Books).
9. Tax Management - Rajaratnam, S., 1994.( Madrsa, India: Forum for Legal Studies Pvt. Ltd).
10. Taxes and Business Strategy: A Planning Approach - Scholes, Myron S., Mark A. Wolfson, Merle Erickson, Edward L. Maydew and Terry Shevlin. 2002 (Upper Saddle River, New Jersey: Prentice-Hall. ).
11. Tax Planning under Direct Tax - Shuklendra, A., and M. G. Gurha. 1992.. (Allahabad: Modern Law House.)
12. Taxation - Wilkinson, M., (Macmillan).
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