What is the Bangladesh standard on Audit(BSA-300) ? Describes in details

Corporate practice bd

Individual income tax is a type of tax levied by governments on the earnings or income of individuals. It's a primary source of revenue for governments at various levels (federal, state, or local) and is used to fund public services and programs. The specific regulations and rates for individual income tax vary widely from one jurisdiction to another.

        Here are some key points about individual income tax:

1. Taxable Income: 

   Individuals are required to report their sources of income, such as wages, salaries, dividends, interest, rental income, and other forms of earnings. Certain deductions, exemptions, and credits may be available to reduce the amount of taxable income.

2. Tax Brackets:

    Tax rates are usually structured in a progressive manner, where higher income levels are subject to higher tax rates. Tax brackets define ranges of income, and each range is taxed at a different rate. The highest tax rate typically applies to the highest income bracket.

3. Deductions and Exemptions: 

   Taxpayers can often claim deductions, exemptions, or tax credits to reduce their taxable income. These might include deductions for mortgage interest, medical expenses, education expenses, and dependent exemptions. The specific deductions and exemptions available can vary based on the tax laws of a particular jurisdiction.

4. Filing Status: 

   Taxpayers usually need to choose a filing status, such as single, married filing jointly, married filing separately, or head of household. Each status has its own tax brackets and rules.

5. Tax Withholding:

    Many individuals have taxes withheld from their paychecks by their employers throughout the year. This withholding is an estimate of the tax liability and is credited toward the total tax liability when the individual files their tax return.

6. Tax Returns: 

   Taxpayers generally need to file a tax return by a specific deadline (usually April 15th in the United States). The tax return provides a detailed breakdown of income, deductions, and credits. If the withheld taxes exceed the actual tax liability, the taxpayer may receive a refund. If they owe more than was withheld, they need to make an additional payment.

7. Penalties and Interest: 

   Failing to file a tax return or failing to pay the required taxes can lead to penalties and interest charges.

8. Tax Planning: 

   Individuals often engage in tax planning to optimize their financial situation and minimize their tax liability. This might involve taking advantage of deductions, tax credits, and other strategies to legally reduce the amount of taxes owed.

It's important to note that tax laws and regulations can change over time and vary significantly from one country to another. If you have specific questions about individual income tax in a particular jurisdiction, it's recommended to consult with a tax professional or refer to official government resources.

           DEMO SHEET:

	Taxpayer’s Name:		MR.X Rahman
	Taxpayer’s TIN No:		25645685963565226
	Designation:		Manager Accounts
	Name of the Employer :		ABC Company  LTD.
	Taxpayer’s Address :		Tangail, Dhanbari
	Taxpayer Status :		Male
	Employment Period :		01.07.2022 to 30.06.2023 (12 month)
	Income Year   :		2022-2023
	Assessment Year:		2023-2024
	Sources of Income :		Salary
	Mode of Payment :		BDT

Particulars	Amount	Amount
Income from Salary (Basic salary, House Rent, Conveyance, Medical & Festival Bonus) Under Section 32 of Income Tax Act-2023.   Less: Exemptions (As per 6th Schedule, Part-1, Para-27) Tk. 4,50,000 or 1/3 of Salary whichever is lower	= 4,50,000    =3,54,484	= 10,63,454         =3,54,484
Taxable Income		=7,08,970

Income tax calculation:

Particulars	Total Income	Taxable Income	Tax rate	Income tax
On first	3,50,000	3,50,000	0%	-
On Nest	1,00,000	1,00,000	5%	5,000
On Nest	4,00,000	2,58,970	10%	25,897
On Nest	5,00,000		15%
On Nest	5,00,000		20%
On balance			25%
Total		=7,08,970		=30,897

(A)  Total tax liability before investment tax credit                                      =  30,897

Investment Tax credit (Part-6, 1st Chapter, Section-78)                         =  (18,270)

Hight limit	10,00,000
3% of (Taxable Income less any income under section 163)	18,270
15% of Allowable Investment	1,09,145
(3% of taxable income or Tk. 10,00,000 or 15% of allowable investment whichever is Lower)

                     B) Tax Liability after investment tax credit                         =  12,627

                                                               Tax already paid                                 =  (10,000)

                                        Finally, Tax To be deposited  by Govt. Challan  =TK. 2,627

             Calculation of Allowable Investment (6th Schedule Part-3)

Life Insurance Premium (10% of policy value) Tk.5,00,000	50,000
Contribution to Deferred Annuity (1/5 of the salary)	1,41,633
Contribution to Provident Fund to which Provident Fund Act, 1925 Applies	24,000
Self-Contribution and Employer’s Contribution to Recognized Provident Fund	2,00,000
Contribution to Super Annotation Fund	-
Investment in Approved Savings/Unit and Mutual Fund Certificates, Securities,	1,00,000
Investment in any Shares	-
Contribution to Deposit Pension Scheme (up to TK. 1,20,000)	1,20,000
Contribution to Benevolent Fund and Group Insurance Premium	-
Contribution to Zakat Fund	1,16,000
Others (if any)	-
Total	=7,27,633

             Tax already paid:

Particulars	Amount
TDS	5,000
AIT	5,000
Total Tax already Paid	=10,000

          

           Monthly Gross Salary:

Basic salary	45,500	12	5,46,000
House Rent	22,750	12	2,73,000
Conveyance	1,400	12	16,800
Medical Allowance	3,500	12	42,000
Leave Encasement	2,527	12	30,334
Performance bonus(IF)	2,500	12	30,000
Yearly Bonus(IF)	1,000	12	12,000
Festival Bonus	7,583	12	91,000
Overtime Allowance(IF)	850	12	10,200

Transportation(IF)	660	12	7,920
Benefits	250	12	3,000
If any others benefit	100	12	1,200
Total	88,621	-	10,63,454

          Excluding's:

Particulars	Amount
1. Any income under section 163
Sec 88: Deduction from payment to workers' participation fund	50,000
Sec 89: Payment to contractors & sub- contractors
Sec 90: Deduction from the payment services
Sec 91: Deduction from payment for Intangible assets
Sec 92: Deduction of tax from advertising bill of media broadcasting
Sec 94: Deduction or collection at source from commission, discount, fees etc.
Sec 100: Deduction from insurance commission
Sec 101: Deduction at source from fees, etc. of surveys of general insurance company
Sec 102: Deduction from interest on saving deposit and fixed deposit etc.
Sec 105: Deduction from interest of saving instruments
Sec 106: Deduction at source from interest on securities
Sec 108:Deduction of tax from receipts in respect of international phone cell
Sec 110:Deduction of tax for rendering , services from convention hall, conference Center etc.
Sec 111:Deduction at source from compensation against acquisition of property
Sec 112:Deduction of tax at source from export cash subsidy
Sec 113:Deduction of tax at source from freight forward agency commission
Sec 114:Deduction of tax against purchase of power
Sec 115:Deduction of tax from income received from real estate developer to land
Sec 116:Deduction of tax from commission or remuneration paid to agent of foreign buyer
Sec 117:Deduction of tax from dividends
Sec 118:Deduction from income from lottery etc.
Sec 120:Collection of tax from importer
Sec 121:Collection of tax from export manpower
Sec 122:Collection of tax from clearing & forwarding agent
Sec 123:Collection of tax from export income
Sec 124:Deduction of tax from any income remitted from aboard in connection
Sec 125:Collection of tax from assets handover
Sec 126:Collection of tax from real estate or land developer
Sec 126:Collection of tax from real estate or land developer
Sec 127:Collection of tax from commission on govt. stamp, court fees and
Sec 128:Collection of tax from lease of property
Sec 129:Collection of tax from cigarette manufacturers
Sec 132:Collection of tax from shipping business of a resident
Sec 133:Collection of tax on sales by public auction
Sec 134:Collection of tax from transfer of share of private limited company
Sec 135:Collection of tax from transfer of securities
Sec 136:Collection of tax from transfer of share of shareholder of stock
Sec 137:Collection of tax from member of stock exchanges
Sec 138:Collection of tax from motor vehicles plying commercially
Sec 139:Collection of tax from operations of marine vessels
2. Any income where reduce tax rate is applicable
3. Any exempted income
Any Firm	50,000
Total	=1,00,000

                                                            

                                                             " THE END"