15% source tax for depositors without e-TIN

26 January, 2020

Depositors have to pay 15 percent source tax on their interest income of savings if they do not have the twelve-digit taxpayer’s identification number or e-TIN.

The e-TIN holders will pay the tax at 10 percent.

Bankers said depositors having the traditional 13-digit tax identification number must collect new e-TINs from the National Board of Revenue to avail the tax deduction facility.

Source tax on the interest income of foreign currency deposits will be the same, they said.

The Bangladesh Bank on Thursday issued a circular asking banks to follow the instruction of deduction of source tax on various types of deposits and saving schemes.

The National Board of Revenue had earlier provided taxpayers with a 13-digit tax identification number.

In 2015, it started issuing a 12-digit tax identification number, replacing the previous one.

In fiscal year 2012-13, the government imposed 15 percent source tax on interest income of depositors without tax identification numbers while 10 percent for those having the numbers.

In a recent instruction, banks have been asked to deduct five percent source tax on interest income of all types of tax-exempted deposits such as pension, gratuity and provident fund.

Banks have to submit 10 percent source tax to the government exchequer on the paid amount of interest of the short-time interbank deposit which is called call money.

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