Guide · the rules in plain words
Investment tax rebate for 2026-27
Under section 78 of the Income Tax Act 2023 as amended by the Finance Act 2026, your rebate is the lowest of three figures: 3% of taxable income, 10% of your eligible investment, or 7,50,000 taka. To get the full rebate you need eligible investment of 30% of your taxable income.
Based on the Finance Act 2026, checked 13 November 2026 · An estimate, not legal or tax advice.
How is the rebate calculated?
rebate = the lowest of (3% × taxable income, 10% × eligible investment, 7,50,000)
Older guides say 15% of investment and a 10 lakh cap. Those figures are out of date for 2026-27.
A worked example
Tanvir’s salary is 9,00,000 taka. After the one-third exemption his taxable income is 6,00,000, and his tax on slabs is 20,000.
| Eligible investment | Rebate | Tax for the year |
|---|---|---|
| None | 0 | 20,000 |
| 1,00,000 | 10,000 (10% of investment) | 10,000 |
| 1,80,000 | 18,000 (3% of taxable income, the cap) | 5,000 (minimum tax applies) |
At 1,80,000 the rebate hits its cap of 3% of taxable income, so investing more saves nothing. The minimum tax of 5,000 also sets a floor.
A second example: a higher salary
Farhana earns 12,00,000 taka a year. After the exemption of 4,00,000, her taxable income is 8,00,000 and her tax on slabs is 45,000.
- Full rebate needs 30% of 8,00,000 = 2,40,000 of eligible investment.
- That gives a rebate of 24,000, which is both 10% of her investment and 3% of her taxable income.
- Her tax falls from 45,000 to 21,000 taka.
Every 10,000 she invests, up to 2,40,000, takes 1,000 off her tax.
How much should I invest?
30% of taxable income gets the full rebate. More investment does not raise the rebate further. The Pawna calculator shows the gap as “invest X more”.
What counts as eligible investment?
Common items: DPS deposits, life insurance premiums, government savings certificates, contributions to a recognised provident fund, and listed shares or mutual funds. Each has its own limits, so check the NBR list before you invest only for tax.
When should I invest?
Within the income year, 1 July to 30 June. Investment made after 30 June counts for the next year.
Common mistakes
- Investing for tax after 30 June. It counts for the next year, not this one.
- Over-investing. Beyond 30% of taxable income the rebate does not grow.
- No proof. Keep certificates and statements; you list them in the return.
Can the rebate take tax below the minimum?
No. If your income is above the tax-free limit, minimum tax of 5,000 taka (1,000 for a first return) still applies after the rebate.
How does the rebate appear in my return?
In the e-return you list each eligible investment with its amount, and the portal works out the rebate using the same three limits. The figure should match the Pawna calculator. If it does not, check that you entered only investments made between 1 July 2025 and 30 June 2026, and only a recognised provident fund.
What should I ask HR?
- Is our provident fund recognised by NBR?
- Does my salary certificate show my provident fund contribution for the year?
- Has my monthly tax deduction already taken my planned investment into account?
Common questions
Is the rebate 15% of investment?
Not for 2026-27. The Finance Act 2026 sets it at 10% of eligible investment, capped at 3% of taxable income and 7,50,000 taka.
Does my provident fund contribution count?
Contributions to a recognised provident fund are commonly eligible. Check your salary certificate, which often shows them.
How much should I invest for the full rebate?
30% of your taxable income. Investing more than that does not increase the rebate.
Try it with your own figures
The calculator runs on your phone. Your figures are not sent anywhere.