A foreign company that supplies goods or services to customers in Bangladesh cannot assume it has no VAT obligations. The Value Added Tax and Supplementary Duty Act 2012 requires some non-residents to appoint a local VAT agent, who carries joint liability. This article covers when VAT applies, how the agent requirement works, how digital and imported services are treated and what compliance involves. It reflects the position at the time of writing.

When a foreign company is within the VAT net

VAT applies to supplies made within Bangladesh. Under the Act, a supply by a non-resident is treated as made within Bangladesh where the non-resident carries on an economic activity from or through a fixed place in Bangladesh. The Act also lists other cases, including supplies relating to immovable property or to goods delivered, installed or assembled in Bangladesh. For supplies to an unregistered person, the listed cases include electronic services delivered to a person located in Bangladesh at the time of supply.

A foreign company with a branch or another fixed place registers in its own right. The agent route applies to a non-resident without a fixed place.

The VAT agent requirement

Section 19 of the Act says that a non-resident who makes a taxable supply in Bangladesh without carrying on an economic activity at a fixed place there shall appoint a VAT agent. In the English translation we reviewed, the agent is responsible for doing all things the Act requires of the non-resident and is jointly and severally liable for taxes, fines, penalties and interest. Registration is in the name of the principal. The National Board of Revenue (NBR) prescribes the manner and conditions of appointment.

The NBR's VAT FAQ lists who can be appointed: a VAT consultant appointed under section 130 of the Act, a registered member of ICAB or ICMAB, a lawyer registered with the Bangladesh Bar Council, a retired VAT officer of at least Assistant Commissioner rank, or a private sector specialist nominated by FBCCI.

Because of the joint liability, the choice of agent and the terms of the agency agreement matter. A Daily Star report in March 2021 said the liability discouraged firms from taking agent roles and described early gaps in the registration process. The agreement should cover information flows, who funds VAT payments, indemnities and termination.

Digital and imported services

PwC's Bangladesh tax summary, reviewed on 31 July 2026, says a non-resident supplying electronic services to VAT-unregistered customers in Bangladesh is liable to register by appointing a VAT agent. The standard VAT rate is 15 per cent. Press reports in 2021 said the NBR's online system had been adjusted so that non-resident platforms could register, file and pay directly through banking channels. They noted that the law still required an agent. Confirm the current practice with the NBR or an adviser before choosing a route.

Where a Bangladeshi business buys services from abroad, imported services are generally reverse-charged. The Finance Act 2026, as summarised by PwC, keeps imported services subject to 15 per cent reverse-charge VAT payable by the importer and treated as the importer's output VAT. At remittance, the bank, financial institution or authorised dealer deposits the VAT through a challan using the importer's codes. The challan serves as the tax invoice and, where the service qualifies, as the input credit document. For a foreign supplier, this means a Bangladeshi customer may already be accounting for VAT on your invoice, so contracts should say who bears VAT and how it is shown.

Whether a given supply is a reverse-charged import or a taxable supply by the non-resident depends on the facts and on whether the recipient is registered. Each contract should be checked on that basis.

VAT registration in Bangladesh: compliance basics for a foreign company

• Under the Finance Act 2026, as summarised by PwC, registration and approval are fully automated through the e-VAT system, with a Business Identification Number (BIN) issued immediately on submission of valid information.
• Quarterly returns are the default for registered and enlisted taxpayers, due by the 15th day after quarter-end. Monthly filing is optional, due by the last day of the following month. PwC reports that manual filing is dispensed with from 1 July 2026.
• PwC reports interest at 1 per cent a month on late deposits of output VAT, for up to 24 months.
• Registration and turnover-tax enlistment thresholds have been revised more than once and the sources we reviewed state different figures, so we have not quoted one. Check the current figure for your situation.
• Registered persons issue tax invoices in the prescribed form and keep VAT records.

Payment mechanics deserve attention. The 2021 Daily Star report flagged that the law was unclear on how a non-resident without a Bangladeshi bank account should remit VAT. Press reports later said payment from outside Bangladesh through banking channels was possible. Agree the route with your agent before the first return is due.

Practical steps

• Map your supplies by customer type (businesses or consumers), by goods or services, and by where they are delivered or used.
• Decide whether you have a fixed place in Bangladesh. If you do, register directly.
• If an agent is needed, shortlist candidates from the NBR's qualified categories and negotiate the agency agreement, including liability and funding.
• Set up invoicing that shows VAT correctly and reconcile it to returns and to bank remittances.
• Put return dates in the group compliance calendar and name an owner at the foreign company.
• Ask your adviser whether income tax or withholding questions arise alongside VAT for the same supplies.

RRH's VAT and Customs Services page describes VAT advisory, compliance, audits and appeals, customs advice and VAT agent services for non-residents. Business Set-up Services covers company set-up and registrations including TIN and VAT, even without a physical presence. Corporate Tax Services covers income tax and withholding compliance.

This article is general information and not legal, regulatory or tax advice. Rules and timelines change, so readers should confirm current requirements with an adviser before acting.