Company formation in Bangladesh does not require the owners to travel: a private limited company is registered with the Registrar of Joint Stock Companies and Firms (RJSC) by electronic filing, once the foreign capital has been brought into a bank. What decides whether the structure works is not registration but how the capital is remitted, the USD 50,000 inward remittance needed to hire a foreign employee, the work-permit routes, how dividends leave the country and how the company is treated in the owners’ home country.
Company formation in Bangladesh: which structure is right for you?
For most foreign investors, company formation in Bangladesh means a private limited company: 100% foreign ownership in most sectors, no statutory minimum capital, a foreign manager and the simple structure of the Companies Act 1994. It is formed with two to fifty members and at least two directors; the choice depends on who the owners are and whether a separate legal entity is wanted.
Formed with a passport, proof of address and evidence of the source of funds; at least two members are needed, so a second individual or a corporate member is required.
- Separate legal entity, limited liability
- No work permit needed for the owner
- Dividends are also declared in the owner’s country
The parent’s registry extract, board resolution and authority documents are apostilled and filed with an English translation; because Bangladesh began applying the apostille only in 2025, the bank’s and the register’s acceptance is checked first.
- A corporate member can appoint directors
- Document preparation adds a few weeks
- The resolution covers capital, name and representative
A branch or liaison office opens with the investment authority’s approval and an initial remittance of at least USD 50,000. A liaison office cannot earn income; a branch may trade but not manufacture.
- Permission runs for three years and is renewed
- One nominated bank is used
- A branch’s profit is taxed in Bangladesh
A public limited company is used to raise capital or list: at least seven members and three directors. If everything produced is exported, an export processing zone (BEPZA) or economic zone company gains a tax holiday and customs relief, on terms set zone by zone. Otherwise a private limited company is enough, and most investors choosing company formation in Bangladesh use it.
Whatever the structure, the reasons to consider company formation in Bangladesh are low registration fees, guaranteed transfer of foreign capital and profit, and incentives for exporters and industry: export cash incentives, accelerated depreciation and tax holidays in export zones. The incentive framework is changing in 2026 as the investment agencies have merged, and a general tax holiday should not be assumed for a new investor.
How does company formation in Bangladesh work, step by step?
Formation is coordinated: a document list is issued, the memorandum and articles are drafted, legalisations and translations are arranged, the registry filing is made and the bank opening is supported. Company formation in Bangladesh is filed electronically; the capital must first be remitted in foreign currency and the bank must issue an encashment certificate.
- Day 1–2Structure and name clearanceMembers, directors and activities are decided; the name is cleared in the registry’s online system and held for a period. The name may not be identical or deceptively similar to an existing one.
- Week 1–2Documents and legalisationA passport and proof of address for an individual member; a registry extract, board resolution and ownership chart for a corporate member. Documents are notarised, apostilled and translated into English.
- CapitalTemporary account and encashment certificateA temporary account is opened at an authorised bank, the capital is remitted in foreign currency and the bank issues the certificate. The share issue to a foreign investor is reported to the central bank within 14 days.
- 5–7 daysElectronic filing and certificateThe memorandum, articles, member and director forms and bank certificate are filed electronically; stamp duty and fees are paid. The registry verifies the certificate with the bank and issues a digital certificate of incorporation.
- After incorporationTax number, trade licence and VATThe tax number takes about three days; a trade licence is obtained from the city corporation, VAT registration is made and the permanent bank account is opened.
- OptionalInvestment authority registrationIndustrial and service projects register for incentives; whether registration is compulsory for trading activities differs between sources, so it is confirmed up front.
An investor who opens a branch or liaison office instead of company formation in Bangladesh follows a different sequence: approval by the investment authority (16 working days), a remittance of at least USD 50,000 within two months of approval, notice to the central bank and registration of the foreign company with the registry. The approval fee is BDT 25,000 and renewal BDT 10,000.
Is a local partner, a local manager or a nominee director required?
No. Company formation in Bangladesh requires no Bangladeshi partner or manager that could be found; a foreign member may hold 100% of the company. A private limited company needs at least two directors, who must be natural persons aged 18 or over and free of bankruptcy or conviction. There is no nationality or residence requirement for directors.
The requirement is a registered address: the company needs a physical address in Bangladesh and a post-office box is not accepted. A company secretary is not mandatory for a private company but is for a public one. Directors are named in the memorandum and entered in the register; they do not have to be employees.
In company formation in Bangladesh, for a nominee director no restrictive rule was found, but every director entered in the register carries liability for the role, and beneficial owners holding 20% or more are recorded separately. For a company managed remotely, where decisions are taken decides whether it is treated as resident in another country.
Capital, trade name and multiple activities
Company formation in Bangladesh has no statutory minimum authorised or paid-up capital; some sources mention a token taka amount. The foreign member remits the capital in foreign currency through an authorised bank, which issues the encashment certificate. Hiring a foreign employee, however, requires an inward remittance of at least USD 50,000 (about EUR 44,000); this is a condition for the work permit and visa recommendation, not for incorporation. Registration fees rise with authorised capital.
In company formation in Bangladesh the trade name is chosen freely with the suffix “Limited” or “Private Limited”; a one-person company uses a different suffix. The register blocks similar names, so the name is searched in advance; for the same name as the parent, the parent’s consent helps.
In company formation in Bangladesh, activities are entered in the objects clause of the memorandum, which is limited to seven clauses and 1,000 words. Any lawful activity may be listed, and adding an activity later requires amending the memorandum. VAT may differ with the activity mix.
What does company formation in Bangladesh cost?
The figures below are indicative amounts for a private limited company where company formation in Bangladesh is the goal (USD 1 = BDT 123; EUR 1 ≈ BDT 138). Official fees are low; the cost is in legal preparation, translation and legalisation, address and accounting. A service quote sets the scope.
| Item | Amount (BDT) |
|---|---|
| Government fees and stamp duty (authorised capital up to BDT 4 million) | ≈ 13,500–15,000 |
| Name clearance | 200–500 |
| Apostille and translation | per document |
| Fees as authorised capital grows | BDT 10 million ≈ 17,600; BDT 100 million ≈ 101,600 |
| Branch or liaison office approval fee | 25,000 (renewal 10,000) |
| Inward remittance to hire a foreign employee | ≈ 6.15 million (USD 50,000) |
| Work permit (per person, per year) | 5,000–25,000 (sources differ) |
| Annual statutory audit and accounting | service quote |
| Registered address (business address) | from 85 per day |
For company formation in Bangladesh, fee schedules differ between sources and depend on authorised capital; the exact amount comes from the register’s fee calculator. No published source gave prices for legal, company secretary or accounting services, so quotes are obtained from local firms. For a branch or liaison office the difference is the USD 50,000 initial remittance and the approval fee.
Taxes, accounting and invoicing after incorporation
Corporate tax. Company formation in Bangladesh means meeting a 27.5% rate for a non-listed company, or 25% if all transactions are made through banks. A minimum tax of 1% of gross receipts applies. Losses are carried forward six years and not back. A branch’s profit is taxed at the same rate, and a 20% branch profit tax applies on after-tax profit remitted. The financial year runs from 1 July to 30 June; advance tax is paid in four instalments.
Dividends and withholding. Dividends to a non-resident company bear 20%, interest 10%, royalties 20% and technical services and know-how 10%. Where a treaty with the owners’ country applies, reduced rates may be available for dividends, interest and royalties; the treaty scope is checked for each income type. Claiming the treaty rate needs a certificate from the tax authority and a residence certificate. A payment abroad is not deductible unless tax was withheld.
VAT. The standard rate is 15%; lower rates and specific-amount VAT also exist, and exports are zero-rated. A business with turnover above BDT 3 million is listed and above BDT 5 million fully registered (sources give different thresholds); a branch or liaison office registers whatever its turnover. VAT on services bought from abroad is withheld by the paying bank. Input VAT requires an invoice, registration numbers and, for purchases above BDT 100,000, payment through a bank.
Accounting and audit. International financial reporting standards apply; every limited company needs an annual statutory audit, and the report carries the professional body’s verification code. The annual return and accounts go to the register within 21–30 days of the general meeting, and the first general meeting is held within 18 months of incorporation. For tax returns, audited accounts are required above a turnover or capital threshold that sources state differently.
Transfer pricing. For company formation in Bangladesh within a group, annual international transactions above BDT 30 million require documentation and an independent accountant’s report. Interest on loans from associated companies below 12% is treated as imputed income; there is no statutory thin-capitalisation ratio.
Invoicing. The statutory invoice may be issued and stored electronically, and VAT returns and payments are made online. No structured e-invoicing mandate exists yet; the tax authority has made first preparations, starting with large taxpayers.
- Within 18 months of incorporation: first general meeting
- 21–30 days after the meeting: annual return and accounts
- 15 Sep, 15 Dec, 15 Mar, 15 Jun: advance tax
- Quarterly, 15th of the next month: VAT return
- 30 June: financial year end and trade licence renewal
- Annually: corporate tax return (deadline differs by source)
- On request: transfer pricing documentation
After company formation in Bangladesh, sending dividends abroad runs through an authorised bank: the company files an auditor-certified application, the dividend is approved in taka, converted at the rate on the remittance date, and no prior central bank approval is required; published sources disagree on this, so the practice is confirmed first. Royalty and technical assistance fees may be paid within limits without approval.
Work permits and employer obligations
Company formation in Bangladesh gives the manager no automatic right to work. For a foreign employee the sequence is: a local job advertisement, the investment authority’s visa recommendation, the visa from a Bangladesh mission, and a work permit application within 15 days of arrival. The process takes 6–10 weeks in total. The conditions are an inward remittance of at least USD 50,000 and a ratio of one foreign employee to five local staff in a commercial company (one to twenty in industry).
For company formation in Bangladesh with a working manager, visa types: a business visa is for meetings and oversight and gives no right to work; a private investor visa runs for one year and extends up to five; an employment visa is issued for up to six months and then extended. A visa on arrival is discretionary and not for work. Visa requirements depend on nationality, so the embassy is asked. The first work permit is for one year and renews annually; renewal needs tax clearance for the company and the employee.
The employer burden after company formation in Bangladesh is as follows: there is no general compulsory social security contribution; the employer contributes to the workers’ profit participation fund (5% of profit, above a capital threshold) and pays gratuity on termination. Income tax is progressive: nothing up to BDT 375,000, then 10% rising to 30%. On a gross monthly salary of BDT 500,000 the effective tax is about 21%. A non-resident is taxed at a flat 30%.
After company formation in Bangladesh, labour rules require a written contract, 8-hour days and 48-hour weeks, overtime at 200%, probation of three months for workers and six for office staff, and employer notice of 30–120 days depending on service and status. Whether a social security agreement applies depends on the owners’ country, and Bangladesh has no general compulsory social insurance. A foreign employee may remit net salary abroad with a tax clearance certificate.
The shareholders’ country: the points that decide the outcome
Bangladesh has double tax treaties with many countries. A treaty allocates taxing rights; residence, controlled foreign company rules and the taxation of dividends are determined by the owners’ home country under its own law. Each point below depends on facts that should be settled before incorporation.
- Place of effective management. A Bangladeshi company whose decisions are taken in another country is treated as resident there in most countries and taxed on its worldwide income. A registered address does not answer the question; a real manager in Bangladesh, decision records and an address are the only defence.
- Two sides of the 27.5% rate. The high rate usually meets the minimum-tax test for participation exemptions in the owners’ country (often 15%). In an export processing zone or economic zone, however, tax-holiday years bring the effective burden toward zero, the test is not met and controlled foreign company rules may apply; for operating companies the passive-income test usually keeps the rule from applying. The choice is made on the total burden in both countries.
- Intra-group invoices. Management and consulting invoices from the parent to its Bangladeshi subsidiary meet a 10% withholding tax, the condition that tax was withheld before the expense is deductible, and transfer pricing documentation; the same invoice is reviewed in the parent’s country. The agreement is designed for both sides together.
- Branch or company? In company formation in Bangladesh this choice matters twice. A branch’s profit counts as the parent’s own income: participation exemptions in the owners’ country do not apply to a branch, and tax paid in Bangladesh is credited against the parent’s tax. A 20% branch profit tax also applies when the profit is remitted. For a limited company, the dividend exemption and controlled foreign company rules apply.
- Treaty rate and residence certificate. For dividends, interest and royalties paid from Bangladesh, the 10% treaty rate needs the recipient’s residence certificate and a certificate from the local tax authority on file at the time of payment; technical service fees fall outside the treaty, so the domestic 10% applies.
- Individual owners. How the withholding tax charged in Bangladesh on dividends is credited in the owner’s own return is a separate question; a manager title or a short-stay visa does not change tax residence elsewhere.
Frequently asked questions
Do I need to travel to Bangladesh for company formation in Bangladesh?
Not for incorporation: documents are prepared and legalised, capital is wired to the bank and the registry filing is electronic. The bank carries out customer due diligence; travel is needed for a visa and work permit if the owner will work in the company as manager.
Can a company, rather than an individual, be the shareholder?
Yes. The parent’s registry extract, board resolution and authority documents are apostilled and filed with an English translation. Bangladesh joined the apostille convention in 2025, so some bodies may not yet apply it; acceptance is asked in advance and embassy legalisation is used if needed.
Is a Bangladeshi partner or local manager required?
No. A foreign member may hold the whole company and no nationality or residence requirement for directors was found. The requirements are two members, two directors and a registered physical address in Bangladesh.
What is the minimum share capital?
A private limited company has no statutory minimum capital. The capital is remitted in foreign currency to an authorised bank, which issues a certificate. Hiring a foreign employee requires an inward remittance of at least USD 50,000.
How long does it take to open a bank account?
A temporary account is opened before incorporation and the capital is remitted to it. After incorporation the funds move to a permanent account with full customer due diligence. A realistic total is three to six weeks; legalisation, the bank and the trade licence set the pace.
Is e-invoicing mandatory for issuing invoices?
No structured e-invoicing mandate exists. The statutory invoice can be issued and stored electronically, and VAT returns and payments are made online; the tax authority has made first preparations for e-invoicing, starting with large taxpayers.
Is an office required in Bangladesh?
For company formation in Bangladesh a physical registered address is required and a post-office box is not accepted. Whether a virtual office is accepted as a registered office could not be confirmed, so the registry and the city corporation issuing the trade licence are asked first.
OzbekCPA advises investors and companies from around the world on company formation in Bangladesh: structure and tax impact, apostille and translation of documents, design of intra-group agreements, and assessment of the structure in the shareholders’ own country. For an assessment based on your activity and shareholding, please contact us. Related articles: Company Formation in Romania · Company Formation in Poland · Company Formation in the Netherlands.
