VAT invoice rules in Bangladesh

In Bangladesh an invoice must show your BIN, itemised lines, and VAT separately at the applicable rate — 5%, 7.5%, 15%, with 15% applying to most work. A Mushak 6.3 invoice — the prescribed VAT challan form — issued at the time of supply.

The Bangladesh rule people miss

The standard rate is 15% but a number of sectors have reduced or truncated rates, and the applicable figure depends on the service category rather than the customer. Truncated rates usually come with a loss of input credit, so the lower headline number is not always cheaper overall.

When VAT registration becomes compulsory

VAT registration is required above an annual turnover of Tk 30 million; turnover tax at a lower rate applies to a band below that.

Assessed on a rolling twelve months in most systems, not your financial year — which is the detail that catches people out.

Which VAT rate applies to what

5%, 7.5% and 10% truncated bands apply to specified services. Which band you sit in is set by the service category in the VAT schedule, not negotiated.

Bands are defined by what you supply, not by who buys it.

How often you file in Bangladesh

The monthly VAT return, Mushak 9.1, is due by the 15th of the following month. Businesses above the turnover threshold are also expected to maintain the prescribed Mushak books rather than ordinary accounting records alone.

A worked VAT example

Invoice Tk 4,100 with a 5% discount shown on the document:

• Net before discount: Tk 4,100
• Discount at 5%: −Tk 205
• Taxable value: Tk 3,895
• VAT at 15%: Tk 584.25
• Total due: Tk 4,479.25

The discounted value is what gets taxed — discounts, deposits and advance payments covers where that stops being obvious.

Correcting an invoice in Bangladesh

The prescribed credit-note form is Mushak 6.8, and using it rather than an ad-hoc document is what lets the adjustment flow into the monthly return.

Invoicing outside Bangladesh

VAT on imported services is collected by way of a reverse charge on the Bangladeshi recipient, so a local client buying from abroad carries the obligation.

Charging tax to a client in another country covers the general shape.

Record keeping in Bangladesh

Five years. What to hand your accountant at year end.

The universal fields — number, both parties, dates, lines, tax separately, total — apply on top of the local rules above. Rates change: checked to mid-2026, a starting point rather than tax advice; verify against the National Board of Revenue.

Set your country once in EstimateBill and the tax is labelled correctly on every invoice after that — GST and GSTIN in India, VAT in the UK, Sales Tax and EIN in the US, across 58 countries.