Professional tax is a tax that is imposed by the state government on all salaried individuals. The professional tax refers to all the working professionals like lawyers, chartered accountants, and doctors. It is levied based on the individual’s trade, employment, or profession. The tax rates vary across all states. However, the maximum amount that can be levied as a professional tax is Rs.2,500 per annum.
Uses of Professional Tax
Here are some ideas about why one should never avoid payment of professional tax:
It is a Judicial Requirement
As per the rules and laws of India, every employee is bound to get the professional tax payment without fail. Companies in many states of India are surely bound by the judiciary to get the registration of professional tax. After the registration, they have to obtain the deductions and meet the service taxes of all the employees who work under them.
To Avoid Paying Penalties
Not getting Professional Tax Online Registration ends in a huge penalty that keeps on increasing over time.
Easy to Comply
The professional tax regulations are simple to understand and are not hard to comply with. The registration methods can be done quickly and additional measures are also much easier.
Deductions can be required based on the professional tax paid. The results will be provided in the year corresponding to which the taxpayer made the payments.
The State Government Tax
The local officials and the state government have the power to get all the professional taxes that are based on employment, profession, trades, and much more. The collected sum of professional tax per annum should not exceed Rs. 2500 per annum.
Professional Tax Applicability
Professional tax is levied on every type of trade and profession in India. It has to be given compulsorily by each staff member who is engaged in any private firm operating in India. Professional tax filing is the responsibility of every business owner, who must take up liability for deduction of professional tax and amount for the same
Professional Tax Variations in Each State
Professional tax fee will additionally have different rates that manage to differ from state to state. The state governments which are levying state tax are Maharashtra, West Bengal, Kerala, Karnataka, Madhya Pradesh, Assam, Tripura, Orissa, Meghalaya, and Gujarat.
Professional Tax for Self-Employed
Any professional who gets a monthly fixed income will need to pay the professional tax.
They can fill the application and get a registration number first. Then, accepting that number, they can pay their taxes in the corresponding banks.
In some states in India, especially Maharashtra, the Professional Tax Act changed from April 2018. Now, a Limited Liability Partnership and every partner of the LLP shall also be liable to pay a professional tax of Rs. 2,500/- per annum.
Who is Exempted from Paying Professional Tax?
The Professional Tax Rules exempt the following people:
- Parents of children experiencing mental or permanent disability.
- Branches of the armed forces ( as indicated in the Air Force Act, Navy Act, and Army Act) including members of auxiliary forces/reservists, working in a particular state.
- People with a considerable or permanent physical disability ( inclusive of blindness)
- People over the age of 65.
- Women employed particularly as an agent under the Directorate of Small Savings or Mahila Pradhan Kshetriya Bachat Yojana.
- Guardians or parents of mentally challenged people
If you have your professional tax return/registration number you can return or pay online using this professional tax online payment as follows:
- Use only the official state government professional tax website to make a professional tax e-payment.
- To find the portal, search online with ‘Professional tax payment’ and town or city name.
- Use the left-side menu bar to agree on Karnataka Professional Tax-KTP tab (assuming you are in Karnataka, or choose the relevant state).
- The website will guide you to decide between professional tax challan options of a certified employer and self-employed professional.
- Now access your Professional Tax Payment Registration Number, details and company name, as prompted.
- Then choose the option from regularly or annually, depending on the demands of the department and rules.
- Next, enter the month and year for which you are paying the tax.
- Enter the Professional Tax Online Payment number column and the penalty or fine if any of them is levied.
- Enter the bank information from which you intend to make the payment and your designated mobile number.
- Tap the ‘enter’ tab and check your details before you click on the ‘submit’ tab.
- On the next screen that loads, click on the tab that states ‘Click here for payment’.
- It will get you to your bank’s net banking page.
- Sign in and get the payment for the outstanding professional tax payment.
- Save the transaction details and professional tax challan in pdf format for later reference