Professional Tax

Professional Tax is a state-level tax applicable to the salaries of employees and professionals, including Chartered Accountants, Lawyers, and doctors, among others.

It is levied across trades and professions in various states. Upon hiring new staff, business owners are responsible for deducting and remitting this tax to the relevant government department. This tax is also applicable to individuals with professional income, such as doctors, lawyers, and chartered accountants, based on their gross income. The tax is calculated slab-wise, with a cap of Rs. 200 per month. States where this tax is levied include Karnataka, West Bengal, Andhra Pradesh, Maharashtra, Tamil Nadu, Gujarat, Assam, Chhattisgarh, Kerala, Meghalaya, Orissa, Tripura, and Madhya Pradesh.

Grounds for Obtaining Professional Tax Registration

• State-level Tax: Mandated by state-level authorities for individuals engaged in trade, employment, or professions.
• Statutory Requirement: Mandatory for employers, including the deduction and payment of tax on behalf of employees, depending on the state.
• Penalties: Failure to pay this tax or obtain registration may result in penalties.
• Tax Deduction: Professional taxpayers can claim a salary deduction on the amount of tax paid.

Documents Required For Professional Tax Registration

For Individuals:

• Self-attested PAN card copy (mandatory).
• Aadhar card of Proprietorship.
• Proprietorship bank account statement and canceled cheque.
• Passport size photograph of the proprietor.
• Attendance and salary register.
• Proprietor's consent for the application.
• Authorization letter.

Proprietor's Identity Proof:

• Self-attested copy of PAN card (mandatory).
• Passport, Aadhar card, Voter ID, or Driving license.

Proprietor's Address Proof:

• Self-attested copy of Telephone/Mobile or Electricity bill.
• Bank Account Statement (Less than 2 months old).

Proprietorship Address Proof:

• Telephone/Mobile/Electricity/Gas bill (Less than 2 months old).
• In the case of rented premises, a notarized copy of Rent Agreement with a No-Objection Certificate (NOC).
• In the case of self-owned premises, the registered title document.

For LLP (Limited Liability Partnership)/Partnership:

• Copy of LLP PAN card attested by Designated Partner of LLP or Partner of Partnership firm.
• Aadhar card of Partners.
• LLP Agreement/Partnership Deed.
• Certificate of Incorporation of LLP or Registration of Partnership.
• LLP Partners' names.
• Attendance and salary register.
• Partners' consent for the application.
• Authorization letter.
• LLP/Firm bank account statement and canceled cheque.
• Passport size photograph of all directors/partners.

Partners' Identity Proof:

• Self-attested copy of PAN card.
• Passport, Aadhar card, Voter ID, or Driving license.

Partners' Address Proof:

• Self-attested copy of Telephone/Mobile or Electricity bill.
• Bank Account Statement (Less than 2 months old).

LLP/Firm Address Proof:

• Telephone/Mobile/Electricity/Gas bill (Less than 2 months old).
• In the case of rented premises, a notarized copy of Rent Agreement with a No-Objection Certificate (NOC).
• In the case of self-owned premises, the registered title document.

For Companies:

• Copy of Company PAN card attested by the company director.
• Company Aadhar card.
• Certificate of Incorporation (CoI).
• Memorandum of Association (MoA)/Articles of Association (AoA).
• Board resolution duly signed.
• Attendance and salary register.
• List of directors.
• Company bank account statement and canceled cheque.
• Authorization letter.
• Passport size photograph of all directors.

Company Directors' Identity Proof:

• Self-attested copy of PAN card.
• Passport, Aadhar card, Voter ID, or Driving license.

Address Proof:

• Self-attested copy of Telephone/Mobile or Electricity bill.
• Bank Account Statement (Less than 2 months old).

Company Address Proof:

• Telephone/Mobile/Electricity/Gas bill (Less than 2 months old).
• In the case of rented premises, a notarized copy of Rent Agreement with a No-Objection Certificate (NOC).
• In the case of self-owned premises, the registered title document.

Registration Process: Professional Tax Registration

ETaxwala: the leading online legal services platform in India, facilitates Professional Tax registration, along with a range of other services such as GST registration, FSSAI registration, TAN registration, PF registration, MSME registration, ESI registration, IEC Code, Digital Signature, and Trade License.

ETaxwala ensures a seamless Professional Tax registration process, allowing you to register from the comfort of your home. Our services are tailored to meet individual needs and adhere to technical specifications.

Get a free consultation for Professional Tax registration with Our Top Rated Experts through simple Registration.

Step 1: Documents & Information - ETaxwala initiates the process by receiving the necessary information and documents from you.

Step 2: Professional Tax Application Drafting & Filing - Our expert team at ETaxwala will skillfully prepare and file your Professional Tax application, ensuring accuracy and compliance.

Step 3: Professional Tax Registration - ETaxwala will handle the entire Professional Tax registration process, including communication with government authorities, streamlining the procedure for you.

Step 4: Congratulations! Your Work is Done. - Upon successful completion of the Professional Tax registration process, ETaxwala ensures that you receive all relevant government communications and certificates.

Choose ETaxwala for a hassle-free and efficient Professional Tax registration experience.

FAQs:

Q. What is the process of professional tax registration if a business has employees in more than one state?


Ans: For businesses with employees in multiple states, obtaining tax registration in each state is necessary. The tax rate may vary for each employee based on their location.

Q. How often do Professional tax returns need to be filed?


Ans: The frequency of filing tax returns depends on the employee's state of residence. Some states require annual or quarterly filings based on liability, while others mandate annual filings.

Q. Are there any penalties for delayed payments of Professional tax?


Ans: Yes, each state imposes its own penalty rates. For instance, in Maharashtra, a 10% penalty can be levied on the overdue amount for professional tax.

Q. Who is responsible for professional tax and depositing the same with the government?


Ans: For employed individuals, the responsibility lies with their employer. Self-employed individuals are personally liable for professional tax payments.

Q. Is professional tax levied across all Indian states?


Ans: No, professional tax is levied in specific states: Karnataka, West Bengal, Andhra Pradesh, Maharashtra, Tamil Nadu, Gujarat, Assam, Chhattisgarh, Kerala, Meghalaya, Orissa, Tripura, and Madhya Pradesh.

Q. Is it possible to pay a lump sum amount of professional tax?


Ans: The option to pay a lump sum amount varies from state to state. Some states allow lump sum payments, while others may have a composition scheme for tax payments.