Items of deemed incomes are contained in section 19 of the Income Tax Ordinance 1984. Major instances of deemed income are discussed below:
§ House rent
If rent free accommodation is provided to the employee, the rental value or 25% of the basic salary, whichever is less, is included in income. If accommodation is provided at a concessional rate, the actual payment by employee is excluded from the above. Tax exempted house rent receivable in cash is Tk. 25,000 per month or 50% of basic salary, whichever is lower.
§ Conveyance allowance
Tax exempt conveyance allowance receivable in cash is a maximum of Tk. 30,000 per annum. If the employer provides conveyance for personal or private use, an amount equal to 5% of the employee’s basic salary or Tk. 60,000, whichever is higher, is added with total income.
§ Loan
Any amount of loan or gift exceeding Tk. 500,000 received other than through bank transfer by an assessee, being an individual, shall be treated as income under the head ‘Income from Other Sources’ in the year it was received.
When abovementioned loan or gift shown as income is subsequently repaid or settled, such repaid or settled amount will be deducted from the total income of that income year.
Bank transfer refers to transfer from the account of the giver to the account of the receiver and such accounts are maintained in a bank or a financial institution legally authorised to operate accounts.
§ Medical expenses:
Where any amount is received or receivable by the employee by way of hospitalisation, medical expenses or medical allowance, the amount so receivable or received exceeds 10% of basic salary or Tk. 120,000 annually, whichever is less, shall be included in his income.
In case of an employee being a person with disability, the medical expense exceeding Tk. 1,000,000 shall be include in his total income.
