Freelancers in the IT sector earn money from online platforms, local clients, or software services. Paying taxes is important to stay legal, avoid penalties, and grow your freelance business.

This guide explains step by step how IT freelancers can register for taxes, calculate payments, and submit returns.

Step 1: Know if You Need to Pay Tax

• All freelancers earning money in Bangladesh must follow tax rules
• Income from platforms like Upwork, Fiverr, or local clients is taxable
• If you earn less than the tax-free limit, you may not pay tax, but registration is still recommended

Tip: Tax registration shows you are a legal freelancer and helps with client trust.

 

Step 2: Register for a Tax Identification Number (TIN)

• Apply for TIN through National Board of Revenue (NBR)
• Required documents:

  • National ID (NID)
  • Proof of address (utility bill or trade license if applicable)
  •  TIN is needed to pay tax and submit returns

Tip: Freelancers can register online via the NBR portal.

 

Step 3: Maintain Income Records

• Keep a record of all payments received from clients
• Include:

  • Date of payment
  • Amount received
  • Client name and platform
    • Maintain records in a notebook, Excel sheet, or accounting software

Tip: Clear records make tax calculation easier and prevent mistakes.

 

Step 4: Calculate Your Tax

• Tax depends on your total annual income
• NBR provides a tax rate table for freelancers and self-employed people
• Include all income from foreign and local clients

Example: If your total income is BDT 500,000, calculate tax based on the NBR slab rate for self-employed income.

 

Step 5: Pay Your Tax

• Freelancers can pay online through banks, mobile banking, or NBR portal
• Partial payments may be allowed for certain incomes
• Keep the payment receipt for records

Tip: Paying tax on time avoids fines or legal issues.

 

Step 6: Submit Annual Tax Return

• All freelancers must file tax returns annually
• Use NBR online portal for submission
• Attach required income details and proof of payment
• Deadline is usually September 30 each year for the previous financial year

Tip: Filing return regularly builds credibility for freelancing clients and future bank loans.

 

Step 7: Use Digital Tools to Manage Tax

• Accounting software or apps help track income, expenses, and tax obligations
• Digital tools reduce mistakes and save time
• Examples: Wave Accounting, QuickBooks, or even Excel sheets

 

Current Opportunities for IT Freelancers

• IT freelancing in Bangladesh is growing rapidly
• Clients hire for web development, app development, graphics, content, and digital marketing
• Paying taxes legally opens opportunities for local partnerships, bank loans, and government support
• Foreign payments can now be received digitally through NBR-approved channels

 

Common Challenges for IT Freelancers

• Lack of knowledge about tax rules and TIN registration
• Missing deadlines for tax payment or return submission
• Confusion about foreign income reporting
• Keeping proper records of client payments

 

Helpful Resources

• National Board of Revenue (NBR): https://nbr.gov.bd
• SME Foundation Freelancer Support: https://smef.gov.bd
• Training programs for IT freelancers on tax and accounting
• Online tutorials and accounting blogs for freelancers

 

Final Advice for IT Freelancers

• Register for a TIN as soon as possible
• Maintain clear records of all income
• Pay taxes on time to avoid fines
• Submit annual tax returns without delay
• Use digital tools to track payments and expenses
• Seek guidance from NBR or SME Foundation if unsure

Following these steps ensures IT freelancers operate legally, build trust with clients, and grow their business without facing tax problems.