A tax-free income remains in the total income. It increases the total taxable income and tax rate of the assessee. This type of income increases the total taxable income and tax rate. A tax rebate is granted at an average rate on the total tax-free income. This type of income increases tax rate. But tax rebate is granted at an average.
If any publicly traded company other than a bank, insurance, financial institutions declare dividends at the rate of more than 20%, it will enjoy 10% of tax rebate on applicable tax. If any company engaged in the production of goods and registered under the companies act, 1994, it will enjoy tax rebate at a rate as mentioned below:
(a) If production in volume exceeds 15% but does not exceed 25% as compared with the preceding year.
The rate of Rebate: 25% of tax on such income
(b) If production in volume exceeds 25% as compared with the preceding year.
The rate of Rebate: 5% of tax on such income.
(c) If total income includes income received from life assurances business.
The rate of Rebate: 12.5% of tax on such income.
(d) On the amount of dividend received from a company registered in Bangladesh under the companies act in force of a body corporals formed in pursuance of an act of parliament.
The rate of Rebate: 15% of tax on such income.
