Step 1
Filling out the application form and attaching the needed papers.
Step 2
Submitting the application and documentation, along with the specified fees, to the competent state government, as well as the tax Department.
Step 3
The authority examines the application and papers before issuing the Registration Certificate.
Overview
Professional Tax is a tax levied by the state government to fund the infrastructure that allows its residents to practice their profession smoothly. This tax is imposed on all professions, trades, and jobs, and its applicability is determined by the revenue of the following:
- Profession
- Trade and
- Employment
States have different professional taxes. According to the state, different laws and regulations apply to the same; nevertheless, all jurisdictions use a slab system based on income to assess professional tax. Also, those who operate a freelance business without hiring any staff must get a professional tax certificate in accordance with the financial threshold, if any, specified by the relevant state authorities.
Professional Tax Certificate Types
- PTEC (Professional Tax Enrolment Certificate)
Via this certificate, the business entity, such as a Private/Public Limited Corporation, owner, or professional, such as a Sole Proprietor or Director, etc., pays this form of professional tax.
- PTRC (Professional Tax Registraton Certificate)
Here, the employer, whether public or private, withholds tax from the employee's pay and pays it to the government.
note: A professional tax imposed is subject to the exemption provided by the respective State to particular categories.
Who is required to register for Professional Taxation?
Tax obligation is determined by the state in which it applies; you may view the list of persons who can apply for Professional Tax Registration:
- Individual
- Public/ Private/ One person company
- Partnership
- Co-operative society
- Association of person
- HUF (Hindi Undivided family)
Documents Necessary for Professional Tax Registration
The following are the necessary documents for Professional Tax Registration:
- Application form
- If the application is a company, include the company's COI, AOA & MOA, and PAN (Attested by the Director).
- Address and identity proof for all directors, as well as a passport-sized photo
- The Company's bank account information, as well as a bank statement and a canceled cheque.
- In the event of rented property, proof of registered office might be a rent agreement or a letter of authorization from the owner.
- In the case of a corporation, the Board Decision; in the case of a partnership, the Declaration of Consent by the relevant Partner; along with salary Pay and Attendance Register.
Penalties Imposed for Professional Tax Regulation Violations
If an individual fails to pay the professional tax on time, the state government may impose a penalty if the individual has not registered for the professional tax even after it has become relevant. The punishment varies from one state to the next. The penalty will be imposed in the following circumstances.
- Failure to Obtain Registration:
In this case, the defaulter will be responsible for the penalty for the time he stays unregistered.
- Late deposition:
The penalty will be imposed in this case owing to a failure to deposit the requisite amount with the government on time.
- Non-deposition of amount:
If someone doesn't deposit the required amount, the officials can collect it from their assets, plus interest and any relevant fine. Moreover, they have the authority to seize his bank account as well. Prosecution cases may also be initiated in extreme circumstances.
In addition, penalties may be assessed for failing to begin payments by the due date and for failing to file returns by the deadline.
- A penalty of Rs 5/- per day is applicable for the late obtainment of the registration certificate.
- The penalty will be 10% of the amount of tax, where there is non/late payment of professional tax,
- In case of late filing of returns, the individual will be liable to pay Rs 1000, and if there is a delay that exceeds one month, the penalty would be Rs 1000.
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Using our platform, our customers can always keep tabs on the development. Our knowledgeable specialists are available by phone if you have any inquiries concerning Professional Tax Registration. Kaspi Services will make sure that your interactions with business people are pleasant and smooth.
Kaspi Services assistance in Professional Tax Registration
- Select a plan for expert assistance.
- Add queries regarding Professional Tax Registration.
- Provide documents to Kaspi services Experts.
- Prepare the Professional Tax Registration Application. Fulfill all requirements for admission for preliminary screening.
- Complete Procedural Actions.
- Get your Professional Tax Registration at your home.
FAQs about Professional Tax Return
Yes, if an individual is a salaried person, he/she must pay professional tax.
A professional tax is a state government assessment that varies from state to state. Every state specifies its own slab rate, and the authority determines the slabs from which the professional tax is subtracted.
The maximum amount of professional tax levied by a state is Rs. 2,500.
- Those who are self-employed are obligated to pay their own taxes.
- In the case of employed individuals, the liability to pay the tax is on the employer.
Yes, Professional Tax is applicable even for freelance professionals if income exceeds the specified limit as per the Professional Tax Laws applicable in the state where the freelancer resides.