Introduction

In Bangladesh, holiday apartments, or "অস্থায়ী ভাড়া" (Osthayi Vara), offer a flexible and comfortable accommodation option for tourists, business travelers, and expatriates.

However, navigating the legal requirements of holiday apartments in Bangladesh requires a clear understanding of various regulations. Subletting is typically governed by rental agreements, and permissions from landlords and local councils are often necessary. Additionally, income from holiday apartments is taxable, and compliance with national and local rules is crucial to avoid penalties.

Whether you're a host looking to capitalize on the growing demand for holiday apartments or a guest seeking an alternative to traditional hotels, understanding these legal nuances is essential. Dive into our comprehensive guide to learn about the legality, registration, tax obligations, and best practices for operating and staying in holiday apartments in Bangladesh.

Overview

In Bangladesh, holiday apartments, or "অস্থায়ী ভাড়া" (Osthayi Vara), offer a flexible and comfortable accommodation option for tourists, business travelers, and expatriates.

However, navigating the legal requirements of holiday apartments in Bangladesh requires a clear understanding of various regulations. Subletting is typically governed by rental agreements, and permissions from landlords and local councils are often necessary. Additionally, income from holiday apartments is taxable, and compliance with national and local rules is crucial to avoid penalties.

Whether you're a host looking to capitalize on the growing demand for holiday apartments or a guest seeking an alternative to traditional hotels, understanding these legal nuances is essential. Dive into our comprehensive guide to learn about the legality, registration, tax obligations, and best practices for operating and staying in holiday apartments in Bangladesh.

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Overview
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short term rentals
What are short Term Rentals in the Country?

In Bangladesh, short-term rentals are commonly referred to as "অস্থায়ী ভাড়া" (Osthayi Vara) in Bengali. These accommodations, known globally as vacation rentals, holiday rentals, tourist accommodations, or transient rentals, provide temporary lodging options for travelers. The concept of holiday apartments involves renting out a property or part of a property, such as a house, apartment, or even a single room, for a short period, typically ranging from a few days to a few weeks.

Holiday apartment in Bangladesh encompass a variety of properties, including furnished apartments, vacation homes, guesthouses, and serviced apartments. These rentals cater to tourists, business travelers, and expatriates looking for flexible and comfortable accommodation options.

Is Subletting Legal?

In Bangladesh, the legality of subletting largely depends on the terms and conditions set forth in the rental agreement between the tenant and the landlord. Generally, subletting is not explicitly addressed in national legislation but is regulated by individual rental contracts. Tenants wishing to sublet their rented property must obtain written consent from their landlord. Failure to do so can result in eviction or other legal actions by the landlord.

Tenants should thoroughly review their rental agreements and seek approval before engaging in holiday apartments. Additionally, some housing societies and local councils may have their own regulations regarding subletting, which must be adhered to by tenants.

National Association for STR Owners
What is the maximum length of stay?

The maximum length of stay for holiday apartments in Bangladesh is generally determined by local regulations and the terms set by the rental platforms or property owners. It can usually last from few days to week and few months.. There is no nationwide maximum length of stay; however, individual cities or municipalities may impose specific restrictions.

The duration of stay may also depend on the type of property and the number of guests accommodated. For instance, serviced apartments and guesthouses may offer longer stays compared to private homes or single-room rentals. Hosts and guests should clearly understand and agree upon the duration of stay before finalizing any rental agreements to avoid potential conflicts or legal issues.

Is there any National Registration Requirement or Permit?

In Bangladesh, there is currently no national requirement for holiday apartment hosts to register their properties with a central government database. However, some cities and municipalities may have their own registration or permit requirements.

The process for obtaining a permit typically involves submitting an application, paying a fee, and providing necessary documents such as property ownership proof, identification proof, and a no-objection certificate (NOC) from the local housing society or council. Fees for permits can vary based on the location and size of the property, and permits are usually valid for one year, requiring annual renewal.

Is there a need for Permission from Landlord/Local Council/Neighbors?

In Bangladesh, regulations for operating holiday apartments generally include the need for permissions from various local entities:

Renting out a property for holiday apartments typically needs you to obtain permission from your landlord. This is especially true if the rental agreement or lease does not explicitly allow for subletting or short-term renting. Approval from local councils or municipal authorities may be required. This can involve ensuring that the property meets safety and zoning regulations, and sometimes obtaining a business license for operating a rental. In some cases, it might be advisable or even required to inform or get consent from neighbors. This helps in mitigating potential disputes related to noise or increased foot traffic.

Local regulations and requirements can vary widely, so it's crucial for hosts to check specific local laws and ordinances applicable to their area. Compliance with these regulations ensures smooth operation and helps avoid legal issues or fines.

Is Short-term rental Income taxable?

Income generated from holiday apartments in Bangladesh is subject to taxation. Hosts must report their rental income and pay applicable taxes, including Value Added Tax (VAT) and income tax. The VAT rate for holiday apartments is generally 15%, and it applies to the rental charges collected from guests. Property owners must pay annual property taxes based on the assessed value of the property. The rate can vary from 0.1% to 1.5% depending on the location and type of property.

Additionally, hosts must include rental income in their annual income tax returns and pay income tax based on the total income earned following the general income tax brackets

There are no specific exemptions for hosts earning below certain thresholds, but general tax exemptions and progressive tax rates based on income levels apply. Local taxes may also be applicable in popular cities, such as property taxes or municipal fees, which hosts must comply with to avoid penalties.

Is there any National Tourism Fund or Tourist Tax?

Currently, Bangladesh does not have a specific national tourism fund or tourist tax imposed on holiday apartment owners. However, the government collects various taxes and fees associated with holiday apartments, which contribute to local tourism development and infrastructure projects. These funds are used to enhance tourism facilities, promote cultural heritage, and improve overall visitor experiences.

Bangladesh imposes a singular tourist-related tax, akin to a departure tax. This levy is incorporated into the overall cost of air travel for domestic passengers. In essence, tourists contribute to this tax when they purchase their flight tickets within the country, hosts are also encouraged to include VAT and other applicable taxes in their rental charges to ensure compliance with national tax regulations. This practice helps maintain transparency and contributes to the country's economic growth and tourism sector development.

Is there any Guest Registration and Reporting Requirement?

In Bangladesh, hosts are not mandated to report guest information to national authorities. Hosts should however keep guest records and obtain identification details from guests, such as passport copies for foreign visitors or national ID cards for Bangladeshi guests, and submit this information to the relevant authorities upon request.

The registration process typically involves filling out a guest registration form, which includes details such as guest names, contact information, duration of stay, and purpose of visit.

Is there any National Health and Safety Requirements?

Health and safety standards for holiday apartment properties in Bangladesh are not explicitly defined at the national level. However, hosts are expected to comply with general safety regulations and guidelines expected of residential apartments or that of hotels to ensure the well-being of their guests. This includes maintaining clean and hygienic living conditions, providing basic amenities such as clean drinking water, and ensuring the property is free from hazards.

Fire safety measures are particularly important, and properties should be equipped with fire extinguishers, smoke detectors, and clear evacuation routes. Additionally, hosts should conduct regular maintenance checks to ensure the property is in good condition and address any safety concerns promptly. Adhering to these practices helps create a safe and comfortable environment for guests and enhances the reputation of the holiday apartment sector in Bangladesh.

Is there any Platform Accountability Requirement?

In Bangladesh, there is no specific national legislation that mandates online platforms to ensure that holiday apartment listings comply with national laws and regulations. However, general business regulations and consumer protection laws apply to these platforms. It is the responsibility of both the hosts and the platforms to adhere to existing legal standards, ensuring that the properties listed meet safety, hygiene, and other regulatory requirements.

Is there any Anti-Discrimination Law?

The Constitution of Bangladesh is a significant source of anti-discrimination provisions. Article 27 of the Constitution guarantees equality before the law, stating that all citizens are equal and entitled to equal protection under the law. Article 28 further elaborates that the State shall not discriminate against any citizen on grounds of religion, race, caste, sex, or place of birth. This foundational principle is applicable across various sectors, including housing and holiday apartments.

Under the Penal Code of Bangladesh, discriminatory actions that result in harm or denial of services can be punishable under various sections related to causing hurt, harassment, or denying lawful rights. These punitive measures can include fines, imprisonment, or both, depending on the nature and extent of the discrimination.

Is there any Data Sharing Requirements?

No policy in Bangladesh mandates data sharing for holiday apartments. However, hosts should have a detailed filing system that accommodates information pertaining to each guest.

The government of Bangladesh can request this information and may use it to help prevent illegal activities and ensure that all visitors comply with local laws.

Is there any National Insurance Requirement?

In Bangladesh, there is no explicit national mandate requiring hosts of holiday apartment properties to have liability insurance. However, the importance of liability insurance for property owners and managers is increasingly recognized, particularly in urban centers where the holiday apartment market is growing.

In major cities like Dhaka and Chittagong, local municipal authorities may have their own regulations requiring property owners to have certain types of insurance, including liability coverage, especially if the property is part of a larger residential or commercial complex.

For hosts offering holiday apartments within their primary residence, their existing homeowner’s insurance policy may provide sufficient coverage, reducing the need for additional liability insurance.

This coverage can protect hosts from significant financial loss in the event of accidents, injuries, or damages that occur on their property. Hosts should consult with insurance providers to understand the specific coverage options available and to tailor policies to their particular needs and circumstances.

Is there any National Zoning law/Cultural Heritage law?

In Bangladesh, the protection of culturally and historically significant areas is governed by several regulations aimed at preserving the nation’s rich heritage.

In

The primary legislation for the protection of cultural and historical sites in Bangladesh is the Antiquities Act of 1968. This act regulates the preservation, maintenance, and restoration of antiquities and historical sites. The government has the authority to declare certain sites as protected, which imposes restrictions on alterations, constructions, and commercial activities, including holiday apartments, in these areas.

Property owners seeking to operate holiday apartments in protected areas must obtain special permits from the Department of Archaeology. This ensures that the use of such properties does not compromise their historical or cultural integrity.

Is there any Environmental Regulations that affects STR?

In Bangladesh, the regulatory landscape for holiday apartments is still developing, and specific nationwide environmental sustainability requirements for holiday apartments are not extensively detailed. However general constitutional rules apply to them.

For example Under the Environmental Conservation Act, 1995, rental properties including short term rentals should manage waste, reduce pollution, and conserve natural resources. Holiday apartment operators are encouraged to follow guidelines that promote sustainability, such as using energy-efficient appliances, conserving water, and managing waste responsibly.

Local governments might have additional regulations or initiatives to promote sustainability in holiday apartments. Property owners and operators should stay informed about local requirements and best practices to ensure compliance and contribute to environmental protection.

Is there any National Tenant Protection Law?

In Bangladesh, tenant protection laws are designed to safeguard the rights of long-term tenants and provide a framework for fair housing practices. The primary legal framework governing landlord-tenant relationships in Bangladesh is the Rent Control Act, 1991.

Under this law, acceptable reasons for eviction might include non-payment of rent, breach of tenancy agreement terms, or if the landlord requires the premises for personal use. Evicting a tenant simply to convert the property into a holiday apartment is not a valid reason under this law.

Landlords are required to provide proper notice before evicting a tenant. The notice period can vary depending on the terms of the tenancy agreement and the reason for eviction.

While these provisions offer significant protections to tenants, enforcement can vary, and tenants may need to seek legal assistance to uphold their rights effectively.

Is there any Reporting Requirements for Foreigners?

In Bangladesh, holiday apartment hosts are required to report foreign guests to the national authorities. Hosts must register their foreign guests with the local police station within 24 hours of their arrival. This involves providing detailed information about the guest, such as passport details, visa status, and duration of stay.

Hosts are required to maintain a record of all foreign guests, including copies of their passports and visas, and must present these records to authorities upon request. In certain cases, hosts may need to inform immigration authorities directly, especially if the guest's stay exceeds a certain period or if there are any irregularities in their documentation.

These requirements are designed to ensure national security and monitor the activities of foreign nationals within the country.

Is there any Digital Platform Regulation Compliance?

Bangladesh does not have explicit regulations tailored specifically to holiday apartments on digital platforms. These digital platforms like Airbnb and Booking.com have general policies to help hosts understand their responsibilities, but they do not conduct in-depth verification of each listing against national regulations.

Is there any Consumer Protection Law that affect STR?

In Bangladesh, the Consumer Protection Act 2009 serves as the primary legislation ensuring consumer protection, including for holiday apartment contracts.

The Act outlines fundamental consumer rights, including the right to be informed about the terms of service and to receive goods and services that meet certain standards of quality and performance. It mandates that businesses provide accurate information about the rental property and ensuring that the services provided matches the description and terms advertised.

It also provides mechanisms for consumers to file complaints and seek redress if they believe their consumer rights have been violated. This includes issues related to the quality of the rental service or discrepancies between the advertised and actual property conditions.

For holiday apartment operators in Bangladesh, adhering to these regulations is crucial to ensure compliance and to protect consumer rights.

Is there any Law that applies to Non-resident Owners?

Non-resident owners of holiday apartment properties in Bangladesh do not face specific residency requirements. But are required to ensure that their property transactions are registered with the appropriate Sub Registry Office to validate the transfer of ownership or lease agreements

Non-resident property owners must comply with general property tax regulations, which include paying municipal taxes, property transfer taxes, and potentially higher withholding taxes on rental income depending on the owner's tax residency status.

Non-compliance with property registration, tax obligations, and rental regulations can lead to fines. Persistent non-compliance may lead to more severe consequences, including eviction notices for tenants or seizure of the property by the authorities.

Is there any classification of STR in the country?
No, serviced apartments are not classified into various categories in Bangladesh.
Are there Special National Event Regulations?

In Bangladesh, there are no specific national regulations tailored exclusively for holiday apartments during special national events or holidays.

During major national events or holidays, such as Independence Day, Pohela Boishakh (Bengali New Year), or Victory Day, it is common for local authorities to enforce general public order regulations more strictly. This includes stricter ID verification, noise restrictions, and sometimes property owners may set their own policies to accommodate increased demand or security concerns.

Is there any Penalty for Violating National Rules?

In Bangladesh, there are several penalties for non-compliance with national regulations.

Landlords that don't register their rental properties and comply with tax obligations can incur penalties including fines and possible legal actions. Evicting a tenant without following proper legal procedures can lead to legal consequences. The government has provisions for imposing fines up to 50% for not following tax regulations, such as receiving house rent payments through non-banking channels for amounts over a specified limit.

Are there National Rules or Regulations Governing Short-Term Rentals in the Country?
Is there any National Tax that affects short-term rental?
permits, license
Are there any Permits, Licenses, or Registrations for Short-term Rentals in the Country?

In Bangladesh, there is currently no national requirement for holiday apartment hosts to register their properties with a central government database. However, some cities and municipalities may have their own registration or permit requirements.

The process for obtaining a permit typically involves submitting an application, paying a fee, and providing necessary documents such as property ownership proof, identification proof, and a no-objection certificate (NOC) from the local housing society or council. Fees for permits can vary based on the location and size of the property, and permits are usually valid for one year, requiring annual renewal.

Is there any National Association for STR owners in the Country?
National Association for STR Owners
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Disclaimer

Lodge compliance is not a licensed tax or financial advisor. Therefore nothing in the above article should be construed as tax, legal, or financial advice. Contact your local tax office for information regarding your personal circumstance.

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