Professional Tax Registration
What is Professional Tax Registration?
Professional tax is a tax which is governed by state government. It applies on those peoples or applied to salaried employees like Chartered accountants, lawyer and doctors. There are the following states which impose this tax Karnataka, West Bengal, Andhra Pradesh, Maharashtra, Tamil Nadu, Gujarat, Assam, Chhattisgarh, Kerala, Meghalaya, Orissa, Tripura and Madhya Pradesh. For this Tax you have to register your firm or business with n 30 days or if you’re professionals you have to register with 30days too. this tax is deducted from salary or wages as per the state. if your firm is on different places you need to be registered all of them in the same department.
If there is delay in registration you have to pay penalty of X Rs per day as per the state government rules. Professional tax is levied on profession and business.
Persons who are ambit of professional tax are employers employing staff for their business need to obtain registration from the assigned department. Each Professional, the Directors of company and LLP has the liability to register business within 30 days.
Professional tax is just like Income Tax
Income Tax is collected by the Central Government and Professional Tax is collected by the State Government.
When this tax was first Announced in India, the maximum limit on the tax was Rs. 2500(i.e.: collected tax is maximum charged by professionals is 2500).
This limit is fixed in 1949
There are some revisions on the limit by the state government for raising additional resource
Applicability of Professional Tax as per the Constitution of India:
Article 276 of the Constitution of India lays down that “there shall be levied and collected a tax on professions, trades, callings and employments, in accordance with the provisions of this Act. Every person engaged in any profession, trade, calling or employment and falling under one or the other of the classes mentioned in the second column of the Schedule shall be liable to pay to the State Government tax at the rate mentioned against the class of such persons in the third column of the said Schedule. Provided that entry 23 in the Schedule shall apply only to such classes of persons as may be specified by the State Government by notification from time to time.”
Penalties for Non-Compliance on Professional Tax Payment:
Delays in obtaining Registration Certificate, a penalty of Rs. 5/- per day.
In case of non/late payment of profession tax, penalty will be 10% of the amount of tax.
In case of late filing of returns, a penalty of Rs. 300 per return will be imposed.
Professional Tax Registration Forms:
There is two type of forms for professional tax registration
Form I- For employer
Form-II- For self-employed person
Start by Filling A form
Fill the form to start registration procedure. Fill all the details that are required.
Submit the Required Documents
Send all the documents that are required, via mail or personally
After documents submission officer works on procedure
As the procedure complete government send you the documents
Employer’s Responsibility for Professional Tax
As we know professional taxes apply on professionals like employers, lawyer, chartered accountant. so if employer pay the professional tax so he has to be deduct the professional tax from the salary of employees. and pay that amount to the concerned department. He/she has to file a return in the department as the given time. The return should include the proof of tax payment. Its not enclosed then return should be invalid.
What is the maximum limit of professional tax?
The maximum limit is Rs. 2500 per annum and it’s first announced in 1949
Which states applied Professional tax??
There are various state who levied professional tax– Karnataka, West Bengal, Andhra Pradesh, Maharashtra, Tamil Nadu, Gujarat, Assam, Chhattisgarh, Kerala, Meghalaya, Orissa, Tripura and Madhya Pradesh.
Who is responsible to deduct Professional Tax?
The employer is responsible for the deduction of the tax from the employee’s salary. And employer have to submit tax within the 30days with the tax proof.
How to Register for Professional Tax?
Apply for the registration of professional tax as you start work as a firm with in 30days. if it’s more than 30 days u have to pay penalties