Liaison Office, Branch Office and Project Office in Bangladesh: Permission, Fees, Renewal and Closure

In this guide: Which office does what · The permission file at Invest Bangladesh · The first sixty days · Running the office: remittances, returns, tax · Extension, changes and the ten-year question · Closing the office

The short answer

Choose a liaison office if the parent only needs eyes and hands in Bangladesh (buyer relations, supplier audits, market study, quality control) and will pay for them from abroad; it is the cheapest form to permit and the most restricted, and it cannot bill anyone here. Choose a branch office if the parent will perform services or sell here in its own name and accepts unlimited liability and a 20% tax on remitted profit on top of corporate tax; for most trading and manufacturing a subsidiary company is cheaper to run and cleaner to exit, so a branch is usually a service or engineering presence. Choose a project office only for an identified project whose implementing agency will recommend it. In each case the parent applies to Invest Bangladesh with its own incorporation papers, audited accounts and board resolution, apostilled; pays Tk 25,000 plus VAT; brings in US$50,000 within two months of the permission; notifies Bangladesh Bank and the RJSC within 30 days; and runs the office through one nominated bank. Permission lasts three years and is extended on an audit report, the bank notification and proof of remittances. If you might one day want to earn here, read our entry routes guide first; a liaison office cannot be converted into a company, only closed.

Which office does what

The decision usually turns on one fact: whether anyone in Bangladesh will pay the office. If yes, a liaison office is the wrong form. If yes and the amounts are substantial, compare the branch with a subsidiary before applying, because the branch’s unlimited liability and the 20% remittance tax make it the more expensive vehicle for anything beyond a service contract or two.

The permission file at Invest Bangladesh

1. Parent’s papers, apostilled in the home country (or attested by the Bangladesh mission where the country is outside the Apostille Convention): certificate of incorporation, Memorandum and Articles or equivalent, the last audited accounts, a board resolution to open the office in Bangladesh naming the country head, and a power of attorney to the person who will sign here. Bangladesh has been a party to the Apostille Convention since 30 March 2025; the published checklist still speaks of mission or chamber attestation and we deal with that at the desk.
2. The office’s papers: proposed activities (drafted to match the type of office and nothing wider), the organogram with local and foreign posts, the proposed office address with a rent agreement, and a forecast of the first year’s expenses to be met by remittance.
3. Project office only: the contract or award and a recommendation from the implementing agency.
4. Application through the One Stop Service, then the hard copies; an inter-ministerial committee that meets about twice a month considers it; the stated standard is 16 working days. Fee Tk 25,000 plus 15% VAT (change of name or address later, Tk 1,000 each).

The permission letter carries conditions: the activities, the US$50,000 remittance within two months, the bank nomination, the quarterly returns, the three-year term, and for a branch a condition restricting outward remittance of profit without a waiver. Read the conditions before accepting the letter; a waiver of a condition costs Tk 1,000 and is easier to obtain at the start than at the first remittance.

The first sixty days

• Bank: nominate one authorised-dealer bank; open the office’s account; all foreign remittances in and out go through it, and any other local account needs that bank’s no-objection. Remit at least US$50,000 from the parent within two months of the permission letter and obtain the encashment certificates; the extension application three years later will ask for them.
• Bangladesh Bank: within 30 days of the permission, notify the Foreign Exchange Investment Department under s.18B of the Foreign Exchange Regulation Act 1947 through the nominated bank, with the permission letter and the parent’s papers. This is the statutory hook for everything the bank later does for the office.
• RJSC: within the same 30 days, file the documents a foreign company establishing a place of business must file under s.379 of the Companies Act 1994 (charter, directors, the person authorised to accept service, the address) and obtain the certificate of filing; later changes are filed under s.380 onwards, and a branch files its accounts under s.381. The RJSC fee is modest; the filing is often forgotten and surfaces at closure.
• Tax: TIN for the office; it is a withholding agent from the first salary and rent payment; a branch registers for VAT if it makes taxable supplies above the threshold or imports.
• Staff: work permits for expatriates within 15 days of their arrival on E visas, on Invest Bangladesh’s recommendation; see our work permit guide. The local-to-foreign ratio published for commercial offices is 5:1, and the 2023 Guidelines are read by some advisers as 1:5 at the start and 1:10 in operation; we confirm the ratio for the particular office with the desk before the organogram is filed.

Running the office: remittances, returns, tax

A liaison office lives on inward remittances; its only outward remittance is the return of unspent funds, with the bank’s post-facto report, and the salaries of expatriates, who may remit up to 80% of net after-tax income during the year and the balance after assessment. It files quarterly income-and-expenditure returns to Invest Bangladesh, the bank, the tax office and Bangladesh Bank, and an annual audit. It has no taxable income, but it files a return and withholds tax at source, and the tax office will look hard at any receipt in its account.

A branch pays corporate tax on its Bangladesh profit at the non-listed company rate (27.5% for the 2026-27 assessment year, 25% where receipts and payments above the thresholds go through banks) and then a branch profit tax of 20% on profit remitted to the head office. Under Bangladesh Bank’s consolidated outward-remittance circular (FEPD-1 Circular 40 of 30 September 2026, valid for a year) the nominated bank remits branch profit without prior Bangladesh Bank approval on the audited Bangladesh accounts, the consolidated head-office accounts with a reconciliation, the tax documents and the details of fixed-asset additions and borrowings, after deducting past losses, fixed-asset additions not financed from depreciation or disposals, profit on immovable property and government cash subsidies; the documents go to Bangladesh Bank within a month for post-facto checking. The Invest Bangladesh condition restricting profit remittance must have been waived first. Head-office expenses charged to the branch are remittable on the same circular with a 15-day report. A joint-venture consortium or association with a foreign partner (a JVCA, not a company) is treated differently: profit remittance needs prior Bangladesh Bank approval under FEID Circular 02 of 20 November 2024. The rules are set out in our repatriation guide.

Extension, changes and the ten-year question

Permission runs for three years. Apply for extension at least two months before expiry with the Bangladesh Bank s.18B notification, the latest audit report, the encashment certificates showing the remittances received, the tax returns and the work-permit position; fee Tk 10,000 plus VAT; the same committee decides. An office whose remittances fall short of its declared expenses, or whose activities have drifted (a liaison office receiving commission is the classic case), is where extensions are refused or conditioned. Changes of name, address or activities are applied for separately at Tk 1,000 each. The 2023 Guidelines are understood to expect a production or service branch to localise, by forming a company, within about ten years, and to test the parent’s standing (years of profitable operation and net worth) at the application; the published summaries of those tests conflict, and we confirm the current reading with the desk for each file rather than print a number here.

Closing the office

1. Newspaper notice of the intended closure in a national daily at least three months before the closing date, inviting claims.
2. Invest Bangladesh: application with the notice, the permission letter, the parent’s board resolution to close, the up-to-date audit report and bank statement, the income tax clearance certificate, an all-dues settlement certificate, the landlord’s no-objection, proof that every expatriate’s work permit has been cancelled, and the parent’s undertaking to bear all liabilities and taxes. No fee; about 16 working days through the committee.
3. Bangladesh Bank: report the closure to the Foreign Exchange Investment Department within the time the closure letter sets, and apply through the nominated bank for permission to repatriate the residual balance, which is always subject to prior Bangladesh Bank permission. The Annexure A list (FEID Circular Letter 02 of 19 September 2019) asks for the closure approval, the head-office resolution, three years of audited accounts, the auditor’s certificate of the remittable amount and of settlement of local liabilities including gratuity, the tax clearance, confirmation that no litigation is pending, the work-permit cancellations and tax clearances of the expatriates, the encashment certificates of all remittances received, the public notice, the final rent settlement, a year’s bank statements, and a CIB report if any local loan was taken. Repayment of any head-office loan to a branch also needs prior approval.
4. NBR: the tax clearance certificate is the gate for both steps above; VAT de-registration where the office held a BIN; final withholding returns.
5. RJSC: notice of cessation of the place of business; then close the bank accounts through the nominated bank.

Budget four to six months from the newspaper notice to the final remittance, and longer if the three years of accounts were not audited on time or an expatriate’s tax clearance is missing. The office that closes cleanly is the one that kept its quarterly returns, its encashment certificates and its RJSC filings from the first year; we start every closure by reconstructing that file.