Professional Tax Registration
Register for Professional Tax Now to Avoid Litigation!
ICI can assist you with registering your company for professional tax.
Our experts will take care of the entire operation for you.
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What is Professional Tax registration?
Profession Tax is levied by the state governments on the employees, employers, traders and working professionals (CA, CS, lawyers, doctors, etc). It is applicable to all forms of business entities. Employers need to register themselves as well as their employees under this Act. The burden of registration and payment of tax is on the employer. Being a state tax, the tax rate, registration process, due dates, penalty and late fees are different in different states.
Table Of Contents
An Overview
Every business owner or professional service provider should obtain a PT registration for their business. The tax is calculated based on gross income slabs. Maximum amount payable under profession tax is Rs 2,500 for employer and Rs 2,500 for each individual employee. If an entity has employees working across various states, then the entity needs to obtain profession tax registrations in all the states. Profession tax is applicable irrespective of the number of employees and turnover from business or profession.
- Following persons need to register under profession tax:-
- Employers (Company, LLP, sole proprietor, HUF, clubs, etc)
- Salaried employees
- Self-employed individuals
- Professionals
- Partners or Directors
- Employer needs to obtain 2 registrations:-
- Profession Tax Enrolment Certificate (PTEC) – To deduct tax from the employee’s salary and pay Professional Tax Registration Certificate (PTRC) – To deduct tax for himself and pay Self-employed people need to obtain only 1 registration - PTRC
Tax Rate
Since professional tax is a state law, the tax rate is different in different states.
Few examples are:-
- Tax rate slabs in Maharashtra
-
Monthly Gross Salary Profession Tax per Month Less than Rs 7,500 (Male) Rs 0 Less than Rs 10,000 (Female) Rs 0 More than Rs 7,500 but less than Rs 10,000 (Male) Rs 175 per month More than Rs 10,000 (Both Male and Female) Rs 2500 per annum
- Tax rate slabs in Karnataka
-
Monthly Gross Salary Profession Tax per Month Up to Rs 15,000 Rs 0 More than Rs 15,000 Rs 200
Due Dates
- For making payments
- Different states have different due dates.
- Eg: For Maharashtra, it is every enrolled person shall pay the tax within one month from the date of enrolment in the first year, thereafter by 30th June of every year
- For filing returns
- Different states have different due dates.
-
Monthly returns
For Maharashtra - PT liability is more than Rs 1,00,000 – Monthly returns before the end of each month For Karnataka it is 20th of the next month -
Annual Returns
For Maharashtra – PT liability is less than Rs 1,00,000 – single return for entire year before 31st March 2020 and for PT liability of more than Rs. 1,00,000 need to file a monthly report before the end of the month. For Karnataka it is 30th April.
Benefits
-
Compliance with State Laws
By registering under the profession tax, you are abiding with the rules framed by the government and thereby avoiding any litigation and penalty -
Income Tax Deductions
Profession tax paid is allowed as a deduction from your income at the time of filing your income tax. Thereby, reducing the tax burden at the time of filing return. -
Easy compliance
Profession tax compliances are neither complicated nor time consuming.
Related read:How To Save More Taxes Using An Income Tax Calculator?
Documents Required
- For Registration:
- In case of a company - Certificate of incorporation, MOA and AOA
- In case of LLP - Certificate of incorporation and LLP agreement
- In case of Partnership Firm – Partnership Deed
Related read: How To Choose Between A Private Ltd. Company And LLP?
- Scanned copy of pan card of the entity
- Address proof of the business – Rent agreement/Electricity bill/ Rent receipts
- Identity proof of director/ partner/ proprietor – Aadhaar Card/ Passport/ Driving License
- Address proof of director/ partner/ proprietor
- Passport Size photograph of director/ partner/ proprietor
- Employee details along with salary register
- Cancelled Cheque or Bank Statement
- Details of business
- Date of commencement of business
- Email ID and mobile number of assessees
- For Filing PT returns:
- Online Portal login credentials
- Salary register of all employees
Process Flow
- Prepare application and documents for submission
- Submit registration application form along with documents
- Grant of registration certificate from the department
- Obtaining registration in case of new employees
- Payment of monthly PT contribution
- Filing of PT returns
How will we help you?
Our experts at ICI will help you obtain Profession Tax registration for your entity as well as employees and file PT returns as well.
- Following are the steps:
- Submit a service request by clicking here
- Our team will connect with you, to understand basic details about the business & provide you with a simple checklist.
- Once you fill up the checklist & provide us with the required documents, our team shall verify them.
- We shall then prepare your PT registration application & submit it to the PT department for further processing.
- In case of any query from the department, our experts shall respond to them on your behalf.
- Once the application is accepted and the certificate is granted, we shall provide you the Profession Tax certificate
- We shall then help you calculate the Profession tax amount for your business as well as for all your employees and file PT returns.
- Throughout the process, our manager will keep you updated on the progress.
FAQs
Contrary to what the name suggests, profession tax is not just levied on professionals. It is also applicable on employment and trade.
It takes 10-15 days to get your PT registration certificate if the application form and documents submitted are error-free. Also, in some cases, the registration may be delayed from the end of the department.
Employers should register the employee within 30 days from the date of employing him.
Yes, one needs to register himself under the profession tax act if he conducts his business or profession in Tamil Nadu.
Along with Tamil Nadu, if your business or profession is in Maharashtra, Assam, Kerala, Punjab, Bihar, Karnataka, Andhra Pradesh, Telangana, Gujarat, Sikkim, Meghalaya, Orissa, Tripura, Madhya Pradesh and West Bengal then you are required to register under profession tax.
In case there are more than one place of work, employers need to take a separate application for each location.
In case of delay in registration – ₹ 5 per day for the entity
Late payment of tax – 10% of the amount of tax
Interest in case of Delay in payment – 1.25% per month
Late filing of returns – ₹ 500 to ₹ 2000 per return
For different states, there are different provisions for penalties. You can get in touch with us to know the penalties in your state.
Yes, freelancers are also required to register and pay professional tax because professional tax is levied if the income exceeds the limit as specified in the state.
If all the 3 companies are in the same state, then you can make the payment from only one company of your choice.
Speak to our experts who shall solve all your doubts.
Call us at +91 7738 066 334 or Mail us at info@indiacompanyincorporation.com
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