Tax Equalization for Foreign / Expatriate Assignments

Bangladesh implements a tax equalization policy for foreign employees working in this country. When an expatriate uses tax equalization, he/she counts taxes for both native and abroad nation’s taxations. However, it is a vague process that can bring failure to the overall taxation procedure. 

To streamline this operation and to get rid of huge tax equalization gaps outsourcing your tax processes from Azuwa Resources. This firm can be the most reliable partner for your tax sector. With their professional hands, taxation may turn smooth and accurate in quick turnaround time.

Statutory Compliance – Payroll Outsourcing Services

Business operations become complicated when anyone wants to expand their business overseas. Foreigners need to follow  Bangladeshi corporate norms and regulations if they want to do business here. When foreign business entrepreneurs expand the business into Bangladesh, many choose to send their local employees to the overseas market.

These expatriate employees who are working for the short or long term can find this process complicated because they had to focus on the laws of both the home country and the foreign land. There is a possibility of an increase in tax burden depending on their assignment.

This is especially true for foreign employees in Bangladesh. For this many companies use a process called tax equalization to reduce the variation in taxes caused by foreign assignments. Azuwa Resources assist foreign employees in every process of tax equalization with their expert knowledge and experience.

BIDA for Foreign Work Permit

About 12,000 foreigners receive permission each year to work in Bangladesh, according to Bangladesh Investment Development Authority (BIDA) data. Foreigners mostly from India, Pakistan, South Korea, Sri Lanka, China, Taiwan, and some European, African countries are currently working in Bangladesh.

They are working in non-government organizations (NGOs), education institutions, hotels, restaurants, garments, hospitals, and other sectors. Any company that is employing foreign nationals needs to take prior permission from BIDA.

Nevertheless, foreign employees face complexities in maintaining tax processes. Bangladesh has a different policy for taxation. So, Azuwa Resources help in this process to make the taxation process easier for foreigners. Income tax is payable by an individual on overall income from all sources excluding exempt income.

Foreign nationals are generally taxed only on income earned from working in Bangladesh and on foreign income received from Bangladesh sources. Non-residents are taxed only on income accrued, received, or deemed to accrue or be received in Bangladesh.

Consequently, their income residing outside Bangladesh is not taxable in the country. Through tax equalization expatriates are taxed on income earned for working in Bangladesh wherever that may be paid and on foreign income received from Bangladesh sources.

Tax Assistance & Consultancy Service

Taxation policy is different for an employee who is working in Bangladesh. They have to pay double taxation for the tax equalization process. Tax equalization tries to remove the tax rates of foreign workers in Bangladesh. 

It is called hypo tax. The workers pay taxes as if they reside in this country like natives. Bangladesh has made double taxation treaties with 34 countries.

Azuwa Resources is a professional advisory, tax consulting, and accounting services company in Bangladesh. Here taxation-related services include tax equalization, corporate tax planning, tax auditing, tax filing, and many more. With our assistance in the tax field, you don’t need to worry about the implications of taxation for your company. We ensure compliance under applicable laws.

Tax Equalization Services for International Clients

Frequent changes in the tax system make it much complex in Bangladesh. Azuwa Resources provides an efficient tax consultancy service. It resolves complexities for all types of clients. Our  tax services for foreign entrepreneurs in Bangladesh are:

For Employers
  • Tax equalization policy and administration

  • Coordination with a foreign government for estimated tax payments

  • Tax treaty review

  • Payroll consulting

  • Visa, licenses, and work permits

  • Formation of tax-effective terms and compensation package

Setting up Liaison Office/Branch Office
For Employees
  • Help in minimization of taxes

  • Creation of necessary forms related to the foreign assignments

  • Pre-departure & post-assignment tax consultations

  • Foreign tax auditing

  • Efficient tax planning & compliance with nationals working abroad