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Illustration of Method of Accounting under Section 72 of the Bangladesh Income Tax Act 2023 |
Method of Accounting under Section 72 | Bangladesh Income Tax Act -2023:
As per section-72(ITA-2023),
Method of Accounting:
1. Subject to the other provisions of this Act, the income of a person shall be computed in accordance with the method of accounting regularly followed by that person.
2. Where a person considers that a change in the method of accounting is necessary, the person may apply to the Deputy Commissioner of Taxes for approval of the proposed change. Upon receipt of such an application, the Deputy Commissioner of Taxes may approve the change if it is necessary for a clear reflection of the assessor’s income.
3.The Board may, by rules, prescribe accounting methods and verification standards for any business, class of business, or any source or category of income.
4. Notwithstanding the foregoing provisions, every company shall maintain its accounts and prepare financial statements in compliance with the InternationalAccounting Standards (IAS), International Financial Reporting Standards (IFRS), and the applicable laws in force in Bangladesh.
You may learn More-
Complete Section List of Income Tax ACT-2023(ITA) in Bangladesh
Exercise of the power of the Tribunal under Section 14 | Bangladesh Income Tax Act -2023
Duties and functions, and jurisdiction of income-tax authorities under Section 08
Special agricultural income under Section 41 | Bangladesh Income Tax Act -2023
Frequently Asked Question(FAQ):
1. What is the Method of Accounting under Section 72 of the Bangladesh Income Tax Act 2023?
Section 72 defines the accounting methods taxpayers must follow for income calculation and tax reporting under the Bangladesh Income Tax Act 2023.
2. Which accounting methods are allowed under Section 72?
Section 72 generally allows the cash method and the mercantile (accrual) method of accounting based on the nature of the business and income.
3. Why is the method of accounting important for income tax purposes?
The method of accounting determines how income, expenses, profits, and tax liabilities are calculated and reported to tax authorities.
4. Can a taxpayer change their accounting method under Section 72?
Yes, taxpayers may change their accounting method subject to conditions and approval requirements under the Bangladesh Income Tax Act 2023.