Complete Guide to Start a Business in Bangladesh

Author: seointellec@gmail.com | March 15, 2025

Bangladesh is one of the fastest-growing economies in South Asia, making it an attractive destination for entrepreneurs and investors. Whether you’re a local entrepreneur or a foreign investor, starting a business in Bangladesh offers immense opportunities. However, navigating through the legal and operational requirements can be challenging. This Complete Guide to Start a Business in Bangladesh takes you through every step to successfully set up your business.

Business Structures in Bangladesh: Which One is Right for You?

Choosing the right business structure is the first step in starting your venture. The structure you select will impact your liability, tax obligations, and business operations.

Common Business Structures:

•         Sole Proprietorship: Ideal for small businesses with minimal investment.
•         Partnership: Suitable for businesses with two or more partners.
•         Private Limited Company: The most popular structure for small to medium businesses.
•         Public Limited Company: Designed for larger businesses with plans to raise capital through public shares.
•         Branch Office and Liaison Office: Perfect for foreign companies looking to establish a presence in Bangladesh.
• Joint Venture: A strategic alliance between local and foreign businesses.

Pro Tip: A private limited company offers limited liability and is the most preferred option for new businesses.

 

How to Register Your Business in Bangladesh

Business registration is a legal requirement that gives your business a legal identity. Follow these steps to get started:

1. Name clearance: Apply for name clearance from the Registrar of Joint Stock Companies and Firms (RJSC).
2.     Drafting Documents: Prepare the Memorandum & Articles of Association.
3.     Filing Incorporation Documents: Submit the necessary forms to RJSC.
4.     Certificate of Incorporation: Once approved, you’ll receive the official certificate.
5.     Trade License: Obtain a trade license from your local city corporation.
6.      Registration (for Foreign Investors): Register with the Bangladesh Investment Development Authority.

Tax, VAT & RJSC Compliance: What You Need to Know

Tax compliance is crucial for running a business legally in Bangladesh. The key registrations include:

•         TIN (Taxpayer Identification Number): mandatory for all businesses.
•         VAT/BIN Registration: Required if your annual turnover exceeds BDT 50 lakh.
•         E-TIN Registration for Directors: Every director must obtain an individual TIN.
•         Corporate Tax Return Filing: Annual submission of income tax returns.
•         Withholding Tax Compliance: Deduction and submission of monthly withholding tax.
•         Prepare Annual Financial Statements: Annual financial statements need to be prepared and get audited on a yearly basis with an enlisted auditor by ICAB and FRC.
•         Submission of Audited Financial Statements: Audited financial statements need to be submitted to TAX and RJSC authorities with the annual returns.
•         Annual General Meeting: Every company shall conduct a General Meeting (Annual General Meeting) on every calendar year.

Pro Tip: Ensure monthly VAT and withholding return submissions to avoid penalties.

Bank Account Opening and Capital Injection

Opening a corporate bank account is necessary to manage business finances. Here’s how you can do it:

•         Choose a commercial bank.
•         Submit the required documents (Certificate of Incorporation, Trade License, TIN Certificate, Board Resolution).
•         Deposit the initial capital.
•         Foreign Investors can open Non-Resident Taka (NRT) accounts before registering the business.

For foreign investors, the Foreign Direct Investment (FDI) process needs to be followed.

Office Setup & Infrastructure

Once the legal formalities are complete, the next step is to set up your office. Consider:

•         Leasing an office space
•         Installing utilities and internet
•         Procuring furniture and equipment
•         Implementing safety and security measures

Licenses and Permits You Need

Depending on your business type, you may need additional licenses such as:

•         Trade License (Mandatory)
•         Import-Export Registration Certificate (IRC/ERC)
•         Environmental Clearance Certificate
•         Fire License
•         Factory License

Hiring Employees and Understanding Labor Laws

Bangladesh has well-defined labor laws. Here’s what you need to know:

•         Draft proper employment contracts.
•         Comply with minimum wage regulations.
•         Register employees under the Contributory Provident Fund (CPF). (Where applicable)
•         Ensure worker profit participation fund (WPPF) contributions.

Accounting and Financial Reporting

Proper bookkeeping and financial reporting help you maintain transparency and avoid legal issues. Recommended accounting software includes:

•         Tally Prime
•         QuickBooks
•         Xero

Monthly financial reporting and annual audits are mandatory for all registered businesses.

Conclusion

Starting a business in Bangladesh requires proper planning, legal compliance, and financial management. By following this guide, you can navigate the process with confidence. Whether you’re setting up a small local business or a foreign-invested enterprise, Bangladesh offers immense growth opportunities.

For expert guidance on business registration, tax compliance, and accounting services, contact S. Rahman & Co.—your trusted partner in business success.

 

 

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