Bangladesh Tax Calculator (2026)
Income tax rates and take-home pay for Bangladesh
Bangladesh Income Tax Brackets (2025-26)
| Bracket | Income Range | Rate |
|---|---|---|
| Tax-free Threshold | BDT 0 - BDT 375,000 | 0.0% |
| Second Bracket | BDT 375,000 - BDT 675,000 | 10.0% |
| Third Bracket | BDT 675,000 - BDT 1,075,000 | 15.0% |
| Fourth Bracket | BDT 1,075,000 - BDT 1,575,000 | 20.0% |
| Fifth Bracket | BDT 1,575,000 - BDT 3,575,000 | 25.0% |
| Top Bracket | BDT 3,575,000+ | 30.0% |
Provident Fund
| Bracket | Income Range | Rate |
|---|---|---|
| Standard Contribution | BDT 0+ | 8.0% |
Key Facts
Tax Year
2025-26
Currency
BDT
Top Rate
30.0%
Brackets
6 brackets
Tax-Free Threshold
BDT 375,000
Social Contributions
1 item
Assumptions
- · Tax brackets for FY 2025/26 used.
- · Employment Income Exemption (1/3 of salary up to 500,000 BDT) modeled as an income-based deduction.
- · Provident Fund contribution modeled at 8% (range 7-8% in source).
- · Net wealth-based surcharges are excluded as they depend on assets, not income.
- · A minimum tax of 5,000 BDT applies if total income exceeds the tax-free threshold (375,000 BDT).
- · Investment tax rebates are excluded as they depend on voluntary personal spending.
Frequently asked questions
How much income tax do I pay in Bangladesh if I earn 500,000 BDT per year?
If you earn 500,000 BDT annually, you would fall into the second tax bracket (10% rate on income above 375,000 BDT). However, you can claim an Employment Income Exemption of up to one-third of your salary (capped at 500,000 BDT), which significantly reduces your taxable income. This exemption, combined with your Provident Fund contribution (8% of gross income), means your actual tax liability would be substantially lower than the headline rate.
What is the tax-free threshold in Bangladesh?
The tax-free threshold in Bangladesh is 375,000 BDT per year. If your income is below this amount, you pay no income tax. However, if your total income exceeds this threshold, a minimum tax of 5,000 BDT applies even if your calculated tax is lower.
Do I have to contribute to a Provident Fund in Bangladesh?
Yes, as an employee in Bangladesh, you must contribute 8% of your gross income to the Provident Fund. The good news is that this contribution is tax-deductible, meaning it reduces your taxable income before income tax is calculated.
What are the income tax brackets in Bangladesh?
Bangladesh has six income tax brackets ranging from 0% (up to 375,000 BDT) to 30% (3,575,000 BDT and above). The rates increase progressively: 10% on income between 375,000-675,000 BDT, 15% between 675,000-1,075,000 BDT, 20% between 1,075,000-1,575,000 BDT, and 25% between 1,575,000-3,575,000 BDT. This progressive system means you only pay higher rates on income that falls into higher brackets.
What is the Employment Income Exemption in Bangladesh?
The Employment Income Exemption allows you to deduct up to one-third of your salary from your taxable income, with a maximum deduction of 500,000 BDT. This means if you earn 600,000 BDT, you can exempt 200,000 BDT (one-third), but if you earn 1,800,000 BDT or more, your exemption is capped at 500,000 BDT. This exemption is a significant benefit that reduces your overall tax burden.
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