Recently, a piece of information has been circulating on social media that anyone who does not file an income tax return despite having an e-TIN may be fined Tk 5,000.
This news has created concern among many ordinary taxpayers. However, according to the National Board of Revenue (NBR) rules and the Income Tax Act, 2023, this is not entirely correct. There is no provision for imposing a fine of the same amount automatically or for everyone.
Is it mandatory to file returns if you have an e-TIN? Many people use an e-TIN for various purposes such as banking services, taking out loans, or registering property. But even if your income later decreases or falls below the tax-free limit, the obligation to file returns does not end for everyone.
According to the NBR guidelines, those who are generally required to file returns include those whose annual income exceeds the applicable tax-free limit, those whose income assessment or taxable income was applicable in previous years, partners or shareholders of a firm or company, directors or employees, government employees, and certain categories of persons specified by law, and those who are required to provide proof of filing returns for specific services or legal purposes.
What is the penalty for not filing a return? According to Section 266(1) of the Income Tax Act, 2023, if a person fails to file a return within the specified time without reasonable cause, the concerned Excise Commissioner may impose a fine. However, this penalty is not the same for everyone and it does not come automatically. The amount of the fine is determined based on the taxpayer's circumstances.
In the case of an individual taxpayer whose income has not been assessed before, the maximum fine can be Tk 5,000. On the other hand, if the income has been assessed before, the maximum fine limit is 50 percent of the tax payable on the last assessed income or Tk 1,000, whichever is higher. Apart from this, the minimum fine can be Tk 1,000 and there is a provision for an additional fine of Tk 50 for each day if the failure continues.
