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Cancelling Trade License in Bangladesh

Table of Contents

Closing the Books: A Practical Guide to Cancelling Your Trade License in Bangladesh
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Obtaining a trade license is a fundamental first step for any business operating legally in Bangladesh. It’s the official permission from your local government authority – be it a City Corporation, Municipality (Pourashava), or Union Parishad – to conduct your specific trade or business within their jurisdiction. However, just as important as obtaining this license is formally cancelling it when your business journey comes to an end. Failing to do so can lead to accumulating renewal fees, potential penalties, and lingering liabilities.

Closing down a business involves many steps, and ensuring the trade license is properly cancelled is a crucial administrative task for a clean exit. Here’s a practical guide to navigating the trade license cancellation process in Bangladesh:

1. Identify the Issuing Authority:
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The first and most crucial step is to identify which local government office originally issued your trade license. You must return to that specific City Corporation zonal office, Municipality office, or Union Parishad office to process the cancellation. The process is handled by the authority governing the area where your business was located.

2. Prepare a Formal Application:
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You need to submit a formal written application requesting the cancellation of your trade license. This letter should be addressed to the appropriate official, usually the Tax Officer or the head of the Revenue Department within the local government office.

Your application should clearly state:

  • Your business’s full name and address as mentioned on the trade license.
  • The Trade License number.
  • The reason for cancellation (e.g., “cessation of business operations,” “permanent closure of business”).
  • The date from which the business ceased operations.
  • A request for the authority to take the necessary steps to formally cancel the license.

3. Gather the Required Documents:
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While specific requirements might vary slightly between different authorities, you will generally need to assemble the following documents:

  • The formal application letter for cancellation.
  • The original Trade License document. (Keep a copy for your records before submitting).
  • A copy of the National ID (NID) card of the proprietor/managing partner/managing director.
  • An up-to-date TIN (Taxpayer Identification Number) certificate copy for the business.
  • Proof of payment of all outstanding trade license renewal fees and any associated local taxes up to the date of business closure. This might include recent payment receipts or a tax clearance confirmation.
  • For Partnerships or Companies: A copy of the resolution (e.g., board resolution for companies, partner agreement for partnerships) confirming the decision to close the business.

It is better to visit the specific local government office beforehand to confirm their exact list of required documents for trade license cancellation.

4. Clear All Outstanding Dues:
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Before submitting your application, ensure all financial obligations related to the trade license are settled. This includes any unpaid renewal fees for previous years and any applicable taxes levied by the local authority. You cannot typically cancel the license if there are outstanding dues.

5. Submit the Application:
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Take your complete application (the letter and all required supporting documents) to the designated counter or official at the relevant local government office (City Corporation/Municipality/Union Parishad).

Crucially, obtain proof of submission. This could be a received stamp and signature on a copy of your application letter or a formal acknowledgement slip issued by the office. This proof is vital in case of any future queries.

And that’s it. Till date there is no official regulation or notification on how to close or surrender a trade license. The proof of submission of your application is the final document you need for the closure.

Why is Formal Cancellation So Important?

  • Avoids Future Fees: Prevents the automatic accumulation of annual renewal fees for a license you no longer need.
  • Prevents Penalties: Protects you from potential fines for failing to renew or comply with regulations related to an inactive business.
  • Provides Closure: Offers official documentation that your business entity is no longer operating under that license, useful for tax purposes and other formalities.
  • Prevents Misuse: Ensures the old license cannot be misused by anyone else.
Key Contact

For assistance with the trade license cancellation process in Bangladesh, please reach out to: