Benefits of Professional Tax

• Very easy to comply and follow the regulations of professional tax
• Failure to pay this tax results in huge penalties
• According to the rules and regulations of India, every employee is bound by the judiciary to obtain the registration of professional tax.
• You can claim deductions in the salary on the basis of professional tax paid.
• The local authorities and the state government have the right to collect professional taxes based on employment.

Registration Process

The registration process of professional tax varies from state to state.

Frequency to file returns

It is important to know the rules of the state before filing for a return because it depends on the state the person lives in.

Penalties

This tax is levied on all types of business entities. Delay in obtaining professional tax can lead to a penalty. In case of late payment of professional tax the penalty will be 10% of the amount of tax.

Professional Tax Rate

The maximum amount payable p.a. towards this tax is INR 2500. This tax is usually a slab amount based on the gross income of the professional.

Responsibility of Employer

The owner of a business is responsible for deducting professional tax from the salaries of his employees and paying the amount to the appropriate government department in the prescribed form within the specified time.

First day

Within first working day, you need to provide your PAN details, address proof and identity proofs of all the directors/partners/proprietors of the company.

Second day

On second working day the application form for professional tax will be filled by the employees and then submitted to the concerned authorities.

Seven days

Within seven working days the basic acknowledgment will be given to you. In case the documents are complete, then the registration hard copy will be issued within 10 days in all major cities. Otherwise you need to submit your documents if missing as mentioned by authorities.

Exemptions from Professional Tax

• Members of the armed forces including members of auxiliary forces or reservists serving in the state
• Parents of children with a permanent disability
• Individuals over 65 years of age
• Physically challenges individual
• Women engaged as agent in Mahila Pradhan Kshetriya Bachat Yojana or Director of Small Savings
• Badli workers in textile industry