Dhaka, Feb 3, 2026: The National Board of Revenue (NBR) has issued a formal clarification on the tax treatment of savings certificate profits, stating that returns earned on investments of up to Tk 500,000 will be subject to a 5 per cent withholding tax, while pensioner savings certificates within the same limit will remain exempt from tax.
The directive was communicated on Tuesday (February 3) through an official letter sent to the Director General of the National Savings Directorate.
How the Tax Rate Will Apply
According to the NBR, when an individual’s total investment across all savings certificates does not exceed Tk 500,000, profits from those investments will be taxed at a reduced source rate of 5 per cent, as outlined in an earlier government notification issued in 2019.
Special Provision for Pensioners
The tax authority has reaffirmed that pensioners will continue to enjoy tax benefits on their designated savings instruments. If a person’s investment in pensioner savings certificates alone stays within Tk 500,000 during a specific income year, no tax will be deducted from the profit earned.
This provision ensures continued financial relief for retired government employees and other eligible pensioners.
Move to Address Investor Concerns
The clarification follows widespread concerns raised by investors who reported that a 10 per cent source tax was being deducted on profits even when investments were below the Tk 500,000 threshold. The issue created confusion among savers and prompted calls for clear guidance from the tax authority.
The NBR said the latest instruction is intended to standardise tax deductions and prevent inconsistent implementation across savings offices.
Higher Rate for Larger Investments
Citing Section 105 of the Income Tax Act 2023, the NBR noted that if an individual’s aggregate investment in savings certificates exceeds Tk 500,000 in a single tax year, profits will be subject to a 10 per cent withholding tax.
Available Savings Instruments
At present, four types of savings certificates are offered under the National Savings Directorate: the Family Savings Certificate, Pensioner Savings Certificate, Five-Year Bangladesh Savings Certificate, and the Three-Month Profit-Based Savings Certificate.
The family savings certificate is exclusively available to women, while the other three instruments are open to both individual and institutional investors.
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