In Bangladesh, cash dividends are calculated based on a share’s face value rather than its market price.
The face value of a typical listed share in Bangladesh is Tk 10. Therefore, if a company declares a 500% cash dividend, shareholders receive 500% of the share’s face value.
However, a 500% cash dividend does not mean investors earn a 500% return on their investment. To understand the actual return, investors need to consider the price they paid for the shares.
Suppose you own 10 shares of Company X, and company X declares 500% cash dividend. This means you will receive a gross dividend of TK 50 per share and since you own 10 shares of company X your total gross dividend is TK 500. ( This is before taxes)
How Is Cash Dividend Taxed in Bangladesh?
Under Section 117 of the Income Tax Act, 2023, as amended, dividend payments to individual shareholders covered by the provision are generally subject to withholding tax at the following rates:
| Shareholder | Dividend withholding tax |
|---|---|
| Individual with TIN | 10% |
| Individual without TIN | 15% |
It simply means Companies deduct tax 10% if individual provides a valid 12 digit Tax Identification Number (TIN) and 15% if fails to provide a valid 12 digit TIN.
For example, if you have a TIN and the applicable withholding rate is 10%, TK 50 would be deducted from your TK 500 gross dividend. You would receive TK 450.
A real example: Marico Bangladesh
On 30 July 2026, Marico Bangladesh announced a 500% interim cash dividend, equivalent to Tk 50 per share, for the first quarter of FY 2026–27. The record date was 27 August 2026. Since I own few shares of Marico Bangladesh, I received the dividend in my bank account after the company deducted 15% from it as tax.
You can read more about my experience in My First Dividend: Tk 50 per Share from Marico Bangladesh.
Final Thoughts
A 500% cash dividend may sound like a huge return, but it simply means that a company is distributing five times the face value of its shares as a cash dividend. It does not mean investors are earning a 500% return on their investment.
Receiving my dividend from Marico Bangladesh helped me understand how cash dividends work in practice, including the tax deducted before the money reaches my bank account.
For investors, understanding the difference between dividend percentages and actual dividend yield is important. A high dividend percentage alone doesn’t necessarily make a company a good investment.
Before investing in any company, always consider its financial performance, dividend history, and current share price.
Disclaimer: This article is for educational and informational purposes only and does not constitute financial, investment, or tax advice. Dividend payments, withholding tax rates, and applicable regulations may vary depending on individual circumstances and changes in legislation. Readers should verify the latest information from official sources and consult a qualified professional before making financial or tax-related decisions.
