Chapter-3 q

Inter-Temporal Tax Planning using alternative tax vehicles q q q q q q

Constant tax rate: It refers the tax rate that remain unchanged in
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various economic condition

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Various Tax Rate for Individuals other than company:

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For individuals other than female taxpayers, senior taxpayers of 65

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years and above, retarded taxpayers and gazetted war-wounded

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freedom fighter, income tax is payable for the

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 On first upto Tk. 2,50,000/- Nil

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 On next upto Tk. 4,00,000/- 10%

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 On next upto Tk. 5,00,000/- 15%

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 On next upto Tk. 6,00,000/- 20%

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 On next upto Tk. 30,00,000/- 25%

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 On balance amount 30%

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For female taxpayers, senior taxpayers of age 65 years and above,

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income tax is payable for the

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 On first upto Tk. 3,00,000/- Nil

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 On next upto Tk. 4,00,000/- 10%

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 On next upto Tk. 5,00,000/- 15%

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 On next upto Tk. 6,00,000/- 20%

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 On next upto Tk. 30,00,000/- 25%

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 On balance amount 30%

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 For retarded taxpayers, tax free income threshold limit is

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TK.3,75,000/-
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 For gazetted war-wounded freedom fighters, tax free income

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threshold limit is Tk. 4,25,000/- .

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  Minimum tax for any individual assessee living in Dhaka and
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Chittagong City Corporation area is Tk. 5,000/-.

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 Minimum tax for any individual assessee living in other City

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Corporations area is Tk. 4,000/-.

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 Minimum tax for any individual assessee living in any other areas
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is Tk. 3,000/-.
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 Non-resident Individual 30% (other than non-resident

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Bangladeshi)
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Various saving vehicles for various markets :

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 Format 1 (Money Market)

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ATA(After qTax qAccumulation) q= qInvestment q{1+interest(1-tax qrate q) q}^n

ATR q(After qTax qReturn) q q= qInterest q(1-tax qrate q)
 Format 2 (Common Stock/ deferred tax rate/single premium deferre
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annuity/land marke)
q q

ATA(After qTax qAccumulation)= qInvestment q(1+interest)^n q(1-Tr)+(Tr*Investment) q

After qTax qReturn qATR q q q q q= [(1+i)^n(1-Tr)+Tr]1/n q-1]
 Format 3 (Mutual Fund)
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ATA(After qTax qAccumulation)=I q{1+i(1-Tg)}^n

After qTax qReturn qATR= i(1-Tg)
 Format 4 (Foreign Corporation)
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ATA(After qTax qAccumulation)= qI(1+i)^n q(1-Tg)+(Tg*I)

After qTax qReturn qATR= [(1+i)^n q(1-Tg)+Tg]1/n q– q1
 Format 5 (Insurance Policy)
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ATA=I(1+i)^n

 Format 6 (Pension)
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ATA=I(1+i)*n
 Format 7 (pension but tax rate between the time of investment and
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return )
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ATA= I/(1-T0) *(1+i)n (1-T1)

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ATR={1/1-T0*(1+i)^n (1-T1)}
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