Income Tax Act 2023
Section 51 - Approval of Bad Debt Expense
(as updated till Finance Act 2024)
(1) Bad debt expense shall be allowable in cases other than banks and 1[finance companies], if —
(a) a bad debt or part thereof is established as irrecoverable and is written off in the books of account of the business;
(b) all reasonable steps have been taken for the recovery of the amount recognized as bad debt prior to being written off;
(c) a bad debt or part thereof is treated as an income in determining the income in an income year.
(2) Bad debt expense shall be allowable in the case of banks and 2[finance company], if—
(a) a bad debt or part thereof is established as irrecoverable by applicable banks and 2[finance company] in Bangladesh in accordance with International Accounting Standards (IAS) and is written off in the books of account of the business;
(b) all reasonable steps have been taken for the recovery of the amount recognized as bad debt prior to being written off;
(c) a bad debt or part of a bad debt is treated as an income in determining the income in an income year.
1 The words “finance companies” were substituted for the word “financial institution” by section 14(a) of the Finance Act, 2024 (Act No. V of 2024) with effect from 1st July 2024.
2 The words “finance company” were substituted for the word “financial institution” by section 14(a) of the Finance Act, 2024 (Act No. V of 2024) with effect from 1st July 2024.
Disclaimer: This is the authentic English text of the Income Tax Act 2023, as published under SRO No. 404-Law/2025 dated 08 October 2025. In the event of any inconsistency or conflict between the content on this website and the official Government publications or gazette notifications relating to laws, rules, regulations or SROs, the official Government publications and notifications shall prevail.