How does EOR cost compare with opening our own entity in Bangladesh?
An EOR replaces the fixed costs of a subsidiary (incorporation, office, audit, accounting, secretarial and annual filings) with one fixed fee per employee per month. For small or uncertain headcounts the EOR is usually cheaper and faster; once the team is large and permanent, an entity's fixed costs are spread across more staff and the balance shifts at around 15 employees.
The comparison below covers the four routes foreign companies actually weigh: registering a subsidiary through RJSC and BIDA, a local EOR, a global employment platform, and engaging contractors.
Routes to employing staff in Bangladesh compared. Entity and platform figures are typical 2025–26 ranges for a foreign-owned private limited company in Dhaka.
| Criterion | Own entity (RJSC/BIDA) | Local EOR (EORBangladesh) | Global platform | Contractor |
|---|
| Legal employer | Your new subsidiary | EOR Bangladesh Limited | Platform's partner entity | None (misclassification risk) |
| Time to first hire | 8–12 weeks | 5–7 business days | 7–14 business days | Days |
| Set-up cost | USD 4,000–8,000 professional fees; minimum paid-up capital remitted | None | USD 0–500 | None |
| Monthly cost | Office, accounting, audit, secretarial: USD 2,500+ before salaries | Fixed USD 299 per employee (USD 249 from 10) | USD 499–699 per employee, plus add-ons | Invoice |
| Compliance risk | Yours: labour, tax, VAT, RJSC filings | Employment compliance carried by EOR | Carried by partner entity | High if the relationship is employment in substance |
| IP ownership | Direct | Assigned to you in the contract | Assigned to you in the contract | Only if the contract says so |
| Local bank account | Required | Not required | Not required | Not required |
| Exit cost | Liquidation, 12–18 months | 30 days' notice | 30–90 days' notice | Low |
| Best for | Large, permanent teams; local customer contracts; holding assets | 1–15 employees; speed; fixed cost; local support | Many countries from one portal | Short, project-based, independent work |
A worked example: five employees for two years
USD 35,880
EOR fees over 24 months (5 × USD 299 × 24)
USD 66,000+
Entity: set-up USD 6,000 + running USD 2,500/month × 24
2 months
Start-date advantage for EOR versus incorporation
Salaries and statutory costs are identical in both routes and are excluded. The entity figure omits the founder's and finance team's time spent on filings, which is usually the larger hidden cost.
What does company registration in Bangladesh involve?
Registering a foreign-owned company in Bangladesh involves name clearance and incorporation with RJSC, a trade licence from the city corporation, e-TIN and VAT registration with the NBR, a local bank account with capital remittance and encashment certificate, and BIDA registration for foreign investment, followed by ongoing annual filings and audits.
- Name clearance and incorporation documents (memorandum, articles, Form XII) filed with RJSC — usually 2–3 weeks
- Trade licence, e-TIN and VAT registration — 2–4 weeks in parallel
- Bank account opening and encashment certificate for share capital — 2–4 weeks
- BIDA registration and, where needed, work permits for expatriate staff — 3–6 weeks
- Annual return, audited accounts, corporate tax return and labour records every year thereafter
When is your own entity the right choice?
- You expect 15 or more employees for several years
- You need to invoice Bangladeshi customers or sign local contracts in your own name
- You will hold property, equipment or a licence that must sit in a local company
- Your group policy requires direct employment in every country
When is a local EOR the right choice?
- You are hiring your first employees and want to start in 5–7 business days, not months
- Headcount is uncertain or project-based and you want a cost that scales down as well as up
- You want a Dhaka-based employer that handles PF, gratuity and NBR withholding without a local finance function
- You may incorporate later and want a provider that will help you transition
What about permanent-establishment risk?
Permanent establishment (PE) is a tax concept determined by treaty and by what your people do in Bangladesh, not by the employment model alone. An EOR keeps employment local and avoids you registering as an employer, but activities such as habitually concluding contracts on your behalf can still create PE exposure. We flag PE-sensitive roles (sales closers, country managers with signing authority) at onboarding and recommend tax advice in both jurisdictions.
This page is informational only and is not a substitute for licensed legal or tax advice in Bangladesh or in your own jurisdiction. Statutory figures are quoted from the Bangladesh Labour Act 2006 as amended, the Bangladesh Labour Rules 2015 and current NBR rules, and were reviewed by Farhana Rahman, LL.M on 1 September 2026.