Dhaka: The National Board of Revenue (NBR) is planning to identify the landlords who did not comply with the obligation to receive house rents exceeding Tk 25,000 through banks.

The government agency will also likely to bring the landlords under tax system through scrutinising their income tax returns for the fiscal year 2015-16, officials of the NBR Income Tax Policy Department said.

The taxman has taken up the decision as a small portion of landlords complied with the rules, although it was made mandatory for them since 1 July, the officials added.

Landlords, according to the law, must collect rents through a scheduled bank if the amount of the rent exceeds Tk 25,000.

The NBR rule was made applicable for all houses, including residential and commercial structures. Individuals, companies and joint owners will be considered landlords according to the rule.  

NBR also requested landlords to keep tenants’ details including names, addresses, rent amount etc. in a separate register.

The rule was timetabled to be implemented in 2015-16 and NBR has so far published advertisements in daily newspapers to aware and encourage the landlords for depositing rents in a bank account. 

‘After expiry of the return submission deadline for fiscal year 2015-16, we will take legal actions against the landlords flouting obligations,’ an NBR official told NTV Online recently.

He also said the non-compliant landlords will have to pay penalties, in addition to regular taxes.

NBR in July 2014 established the rule after it realised that taxing landlords will significantly increase the government revenue collection. According to a survey conducted in 2014, the tax authority found 1.66 lakh landlords out of the tax net despite having huge income.

Landlords were asked to use their existing bank accounts or open a new one to deposit house rents.

Tenants were instructed to pay the rents through cross cheque or deposit the money in the bank account of the landlords.

‘We did not go for stern actions yet as we want them [landlords] to be acquainted with the process by themselves. We will scrutinise their files, and if anyone found non-compliant, they will be penalised 50% of the tax payable on incomes derived from the house rent or Tk 5,000, whichever is higher,’ the official said.

The board will also fine landlords if they hide their actual income from rents.

NBR former chairman Abdul Majid told NTV Online that the decision would be a dynamic one if the NBR can properly implement it.

‘It is a tough job to identify the non-compliant house owners and collect tax from them, but once the decision comes into effect, it would help the government collect more revenue,’ he said.