Tax-free income limit remains Tk 3.5 lakh

The government has proposed to keep the tax-free income limit at Tk 3.5 lakh for individual taxpayers for FY2024-25.

Tabling the national budget for FY25, Finance Minister Abul Hassan Mahmud Ali said that the maximum tax free income threshold for individual taxpayers was increased to Tk 3.50 lakh in FY2023-24 in phases. “The tax-free income threshold is higher for women, senior citizens, physically challenged persons, members of the third gender and war wounded freedom fighters.

“This has brought back some comfort in the life of ordinary taxpayers due to reduction in tax burden and encouraged tax payers to pay taxes regularly.”

“I propose to keep the tax- free income thresholds of natural individual taxpayers and firms unchanged for the financial year 2024-25. At the same time, it is proposed to increase the existing maximum tax rate from 25 per cent to 30 per cent for natural individual taxpayers and firms with tax slab adjustments,” he said in the budget speech.

In line with his proposal, the higher tax-free threshold for women, senior citizens, people with disabilities, those identifying as a third gender and freedom fighters will also remain unchanged.

According to the budget proposal, for these groups, the limits will remain at Tk 4 lakh for women and senior citizens, Tk 4.75 lakh for people with disabilities and third gender, and Tk 5 lakh for the heroic freedom fighters.

Also, the threshold will go up by Tk 50,000 per child for the parents or guardians raising a physically challenged or adopted child.