Trade Licence Fees, Renewal and Cancellation in Bangladesh 2026: How the Fee Is Set, What Is Added to It, and the Renewal Cycle
There is no single trade-licence fee. The amount depends on which local authority you sit in, which of its business categories you fall under and, for companies, your paid-up capital — and then VAT, source tax and sometimes signboard tax are added on top. This guide explains the structure so that the figure on your demand note makes sense, and sets out renewal, surcharge, cancellation and the online-business rules.
- Fees are fixed by each local authority's tax schedule: city corporations under the 2016 Model Tax Schedule (by business category, and by paid-up capital for companies), pourashavas under the 2014 schedule, union parishads under the 2013 schedule.
- On top of the fee: 15% VAT, advance income tax collected at renewal, a form fee and stamp, and signboard tax where a board is displayed.
- A licence runs for one financial year to 30 June; renewal after the corporation's cut-off carries a surcharge, and renewal in a city corporation or municipality needs a proof of submission of income tax return.
- A new licence needs only a TIN certificate; online sellers may trade on a Digital Business ID, but a bank account, BIN and most dealings still turn on the licence.
In this guide: How the fee is determined · What is added to the fee · Renewal: the cycle and the surcharge · Cancellation, change of address and closing down · Online and Facebook businesses: DBID and the licence
The short answer
A trade licence is issued by the local authority where the business operates — Dhaka North or South City Corporation and the other city corporations, a pourashava, or a union parishad — under the Local Government Acts and each authority’s tax schedule. The schedule lists business categories with a fee against each (roughly Tk 100 for the smallest rural trades to several tens of thousands for banks, large factories and companies, which are banded by paid-up capital), and the authority may revise it with government approval. The fee is the base; what you actually pay adds 15% VAT, income tax collected at source on renewal, a nominal form fee and stamp, and signboard tax. Our existing guide on getting a trade licence, TIN and BIN covers the first application; this one covers the money and the renewal cycle.
How the fee is determined
| Where the business is | Schedule | What drives the fee |
|---|---|---|
| Dhaka North, Dhaka South and the other city corporations | City Corporation Model Tax Schedule 2016 (under s.82 and the Second Schedule of the 2009 Act), as adopted by each corporation | The business category (some 300 listed, from tea stall to bank); for limited companies, a band by paid-up capital; for factories, by capital or workforce |
| Pourashavas | Pourashava Model Tax Schedule 2014 | Category and class of pourashava (A, B, C); fees lower than city corporations |
| Union parishads | Union Parishad Model Tax Schedule 2013 | Category; the lowest fees in the system |
Two points of honesty. First, we have not found an official, current, category-by-category fee list for DNCC or DSCC published online; the figures circulating on law-firm sites are copied from the 2016 schedule and are not always what the zonal office charges today. The reliable source is the demand note the zonal revenue office issues against your category — bring us a recent one and we will tell you whether it is right. Second, a business that straddles categories (a restaurant that also caters; a showroom that also imports) is charged in the higher category, and the choice of category at first application follows the business for years.
What is added to the fee
- VAT at 15% on the licence fee, collected by the corporation with the fee.
- Advance income tax, collected at renewal under the Income Tax Act and credited against your income tax — the amount depends on the location of the business (city corporation, other municipal area, elsewhere) and is set by the Act’s schedule, which we are confirming for 2026-27.
- Signboard tax, where the business displays a board, charged per square foot under the corporation’s schedule.
- A form fee and a declaration on non-judicial stamp at first application.
Separately, since 1 July 2026 the corporation must see your BIN (VAT registration or turnover-tax enlistment certificate) before renewing a licence (s.4(3) of the VAT Act), and under s.264 of the Income Tax Act a proof of submission of income tax return is required for renewal in a city corporation or municipality. A new licence needs only the TIN certificate. Our BIN guide and PSR guide cover both.
Renewal: the cycle and the surcharge
A trade licence is valid for one financial year and expires on 30 June. Each corporation sets a regular renewal window — DNCC’s has typically run to 30 September, with extensions announced in some years to November — after which a late surcharge is added for each year or part-year of delay; DSCC has periodically waived the surcharge in amnesty windows. The surcharge rate is in each corporation’s schedule and we have not been able to confirm the current figure; renewing by September avoids the question. DNCC offers a rebate for full online payment through its e-revenue portal (erevenue.dncc.gov.bd), and the national e-trade licence portal covers other authorities. A licence left unrenewed for several years is renewed by paying every intervening year’s fee and surcharge — a business that lapsed in 2022 and wants a bank loan in 2026 pays four years at once.
Documents for renewal: the previous licence, the TIN and proof of return, the BIN, and the holding-tax receipt or rent agreement for the premises.
Cancellation, change of address and closing down
To cancel, apply in writing to the zonal revenue office with the original licence, stating the date of closure; arrears to that date are payable first, and the office endorses the cancellation. A change of business address within the same corporation is an amendment; a move to another corporation or pourashava means a new licence there. A change of ownership (sale of a proprietorship) is also a new licence in the buyer’s name, not a transfer. We advise cancelling a dead licence rather than leaving it, because the unrenewed years accumulate and resurface when the proprietor next needs a licence, a BIN or a loan.
Online and Facebook businesses: DBID and the licence
Since 2022 the Commerce Ministry has run the Digital Business Identity (DBID) for e-commerce and social-media businesses: registration through the DBID system, display of the ID on the page or site, and no trade licence required for a business that operates only through its official website or social-media page. Take-up has been low, and a draft Cross-Border Digital Trade Policy issued in July 2026 proposes extending DBID to foreign platforms. In practice an online seller still needs a trade licence the moment it wants a business bank account, a BIN, an IRC or a courier contract, and the 2026 VAT rules make the BIN a prerequisite for a merchant account. We register both: DBID for the platform, trade licence for the bank.
Read the demand note
We check the category, the fee, the VAT, source tax and signboard tax against the schedule.
Line up the PSR and BIN
The return acknowledgement and BIN certificate that the renewal counter will ask for.
Renew on time
Online where the corporation allows, by September, with the rebate where offered.
Clean up old licences
We cancel dead licences and settle lapsed years before they block a loan or a BIN.
Common questions
How much is a trade licence fee in Bangladesh?
It depends on the local authority and the business category: city corporations charge under the 2016 Model Tax Schedule (companies by paid-up capital), pourashavas under the 2014 schedule and union parishads under the 2013 schedule. Expect 15% VAT, source tax and any signboard tax on top. The reliable figure is the zonal office's demand note for your category.
When does a trade licence expire?
On 30 June each year. Renew within the corporation's window — usually by September — to avoid the late surcharge.
What documents are needed to renew?
The previous licence, your TIN with proof of submission of return, your BIN (required for renewal since 1 July 2026), and the premises document (holding-tax receipt or rent agreement).
Do I need an income tax return to renew a trade licence?
Yes, in a city corporation or municipality, under s.264 of the Income Tax Act 2023. A new licence needs only the TIN certificate.
Is VAT charged on the trade licence fee?
Yes, 15% VAT is collected with the fee, along with advance income tax at renewal.
Can I renew a trade licence online?
In Dhaka North through erevenue.dncc.gov.bd, with a rebate for full online payment; other authorities through the national e-trade licence portal where enabled.
How do I cancel a trade licence?
Apply in writing to the zonal revenue office with the original licence and the closure date, pay any arrears to that date, and have the cancellation endorsed.
Does a Facebook business need a trade licence?
Under the Commerce Ministry's DBID scheme a business operating only through its page or site may trade on a Digital Business ID. In practice a trade licence is still needed for a business bank account, BIN, IRC or courier contract.
More in Tax, VAT & Customs
Income tax returns, TIN, VAT and BIN, Mushak forms, customs duty and what to do when NBR sends a notice.
A demand note that looks wrong, or years of unrenewed licence?
Send us the note or the old licence; we will tell you what is owed and sort it with the zonal office. A written assessment costs nothing.
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