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Deduction of Tax from Money Paid to Contractors, Suppliers, etc. under Section 89 of the Bangladesh Income Tax Act, 2023. |
Deduction of tax from money paid to contractors, suppliers, etc under Section 89 | Bangladesh Income Tax Act -2023
As per section-89(ITA-2023),
Deduction of Tax from Payments to Contractors, Suppliers, and Others
Where a specified person makes any payment to a resident for any of the following purposes:
(a) entering into a contract, other than a contract for providing or rendering a service covered under any other section of Part 7;
(b) the supply of goods;
(c) the manufacture, processing, or conversion of goods; or
(d) printing, packaging, or binding,
the person responsible for making the payment shall, at the time of payment, deduct tax from the base value of the payment at the prescribed rate, not exceeding 10% (ten percent).
You may learn more-
Complete Section List of Income TaxACT-2023(ITA) in Bangladesh
Exercise of the power of theTribunal under Section 14 | Bangladesh Income Tax Act -2023
Frequently Asked Question (FAQ):
1. What is Section 89 of the Bangladesh Income Tax Act 2023?
Section 89 of the Bangladesh Income Tax Act 2023 requires tax to be deducted at source (TDS) from payments made to contractors, suppliers, and certain service providers before the payment is released.
2. Who is responsible for deducting tax under Section 89?
Any person or organization required by law to deduct tax at source, including government bodies, companies, firms, and specified institutions, must deduct tax under Section 89 before making eligible payments.
3. Which payments are covered under Section 89?
Section 89 generally applies to payments made to contractors, suppliers, and other specified recipients for contracts, procurement, works, and related services as defined under the Bangladesh Income Tax Act 2023.
4. What happens if tax is not deducted under Section 89?
Failure to deduct or deposit tax under Section 89 may result in penalties, interest, or other legal consequences under the Bangladesh Income Tax Act 2023.