What is Professional Tax In India: Applicability, Exemptions & Penalties For Non-Payment of P-Tax
Professional tax is a state government tax imposed on individuals who earn income through various means. It's not exclusive to professionals but applies to all individuals, regardless of their occupation or trade.
What is Professional Tax In India: Applicability, Exemptions & Penalties For Non-Payment of P-Tax
This article explains what is professional tax and how it applies to individuals, whether it is mandatory in certain states, and how to pay it online. Being a salaried person, you will be required to pay professional tax In India which is usually listed below your gross salary on your monthly salary slip. Before we delve deeper, let's understand what professional tax is and when it applies in detail.
What is Professional Tax?
Professional tax is a state government tax imposed on individuals who earn income through various means. It's not exclusive to professionals but applies to all individuals, regardless of their occupation or trade. The tax amount, typically around Rs. 200, may vary from state to state.
The maximum limit for professional tax per person per year is set at Rs. 2,500, as per state regulations. This tax is deducted under Section 16 (iii) of the Income Tax Act, 1961, and individuals can claim this deduction when filing their income tax returns.
Professional tax, often referred to as P-tax, is specific to certain states. As of now, only a few states such as West Bengal, Maharashtra, Karnataka, Andhra Pradesh, Telangana, Kerala, and Tamil Nadu require earning individuals to pay professional tax to the state. Whereas, other states of India do not ask for the professional tax payment of income tax.
Who is Required To Pay Professional Tax?
Professional tax is not solely meant for professionals like doctors or lawyers; it applies to various entities and individuals. Here's a list of those who are required to pay professional tax:
1. Companies and Business Firms
2. Limited Liability Partnerships (LLP)
3. Corporations
4. Co-op Societies and Associations
5. Hindu Undivided Family
6. Clubs
7. Lawyers and Legal Practitioners
8. Contractors
9. Architects
10. Engineers
11. Insurance agents
12. Chartered Accountants (CA)
13. Company Secretary (CS)
14. Surveyors
15. Tax consultants
16. Management consultants
17. Doctors and other medical representatives.
Who Collects The Professional Tax?
1. Employer Collection: Employers deduct the professional tax amount from their employees' gross salaries and submit it to the state government. Any type of failure may attract some penalties.
2. Self-Employed: If you are self-employed, you are responsible for paying your professional tax directly to the state government.
To pay this tax, you must complete a specific form, and your state will provide you with a registration number. Additionally, in some states, the government offers tax refunds when paid as a lump sum for several years. Therefore, it's advisable to check the professional tax regulations in your respective state.
However, some union territories levy professional tax but on the other hand, there are some union territories also where there is no p-tax applicable. Below is the list of states and UTs with or without professional tax.
|
States & UTs without professional tax |
States & UTs with professional tax |
|
Arunachal Pradesh |
Gujrat |
|
Chandigarh |
Assam |
|
Chhattisgarh |
Andhra Pradesh |
|
Andaman & Nicobar Islands |
Bihar |
|
Uttarakhand |
Kerala |
|
Uttar Pradesh |
Karnataka |
|
Ladakh |
Jharkhand |
|
Rajsthan |
Maharashtra |
|
Lakshadweep |
West Bengal |
|
Delhi |
Tripura |
|
Jammu & Kashmir |
Telangana |
|
Himachal Pradesh |
Tamil Nadu |
|
Goa |
Punjab |
|
Haryana |
Sikkim |
|
Daman & Diu |
Puducherry |
|
Dadra & Nagar Haveli |
Odisha |
|
Nagaland |
|
|
Meghalaya |
|
|
Manipur |
|
|
Mizoram |
|
|
Madhya Pradesh |
Professional Tax Slabs in the Different States
Below is the list of all states and their income slab rates corresponding to professional tax as well as Union Territories PT is levied.
Assam
|
Salary Per Month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 10,000 |
0 |
|
Between 10,001-15,000 |
150 |
|
Between 15,001-25,000 |
180 |
|
More than 25,000 |
208 |
Bihar
|
Salary Per Month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 25,000 |
0 |
|
Between 25,001-41,666 |
83.33 |
|
Between 41,667-83,333 |
166.67 |
|
More than 82,334 |
208.33 |
Andhra Pradesh
|
Salary Per Month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 15,000 |
0 |
|
Between 15,001-20,000 |
150 |
|
More than 20,000 |
200 |
Gujrat
|
Salary Per Month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 5,999 |
0 |
|
Between 6,000-8,999 |
80 |
|
Between 9,000-11,999 |
150 |
|
More than 12,000 |
200 |
Jharkhand
|
Salary Per Month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 25,000 |
0 |
|
Between 25,001- 41,666 |
100 |
|
Between 41,667- 66,666 |
150 |
|
Between 66,667- 83,333 |
175 |
|
More than 83,334 |
208( For 11 months), 212 (For 12 months) |
Kerala
|
Salary Per Month (Rs.)-semi-annual |
Professional Tax Per Month (Rs.)-semi-annual |
|
Up to 1,999 |
0 |
|
Between 2,000-2999 |
20 |
|
Between 3,000- 4,999 |
30 |
|
Between 5,000- 7,499 |
50 |
|
Between 7,500- 9,999 |
75 |
|
Between 10,000- 12,499 |
100 |
|
Between 12,500- 16,666 |
125 |
|
Between 16,667- 20,833 |
166 |
|
More than 20,834 |
208 |
Madhya Pradesh
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 18,750 |
0 |
|
Between 18,751-25,000 |
125 |
|
Between 25,001-33,333 |
167 |
|
More than 33,334 |
208( For 11 months), 212 (For 12 months) |
Maharashtra
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 7,500 |
0 |
|
Between 7,501- 10,000 |
175 |
|
More than 10,001 |
209 (For 11 months), 300 (For 12 months) |
Manipur
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 4250 |
0 |
|
Between 4251- 6250 |
100 |
|
Between 6251- 8333 |
167 |
|
Between 8,334- 10,417 |
200 |
|
More than 10,417 |
208( For 11 months), 212 (For 12 months) |
Meghalaya
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 4166 |
0 |
|
Between 4167- 6250 |
16.50 |
|
Between 6,251- 8333 |
25 |
|
Between 8334- 12500 |
41.50 |
|
Between 12501- 16666 |
62.50 |
|
Between 16667- 20833 |
83.33 |
|
Between 20835-25000 |
104.16 |
|
Between 25001-29166 |
125 |
|
Between 29167-33333 |
150 |
|
Between 33334-37500 |
175 |
|
Between 37501-41666 |
200 |
|
More than 41667 |
208 |
Mizoram
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 833 |
0 |
|
Between 834 – 1,250 |
8 |
|
Between 1,251 – 1667 |
12.5 |
|
Between 1668 – 2,083 |
16.6 |
|
Between 2,084 – 2,917 |
20.83 |
|
Between 2,918 – 4,167 |
25 |
|
Between 4,168 – 6,250 |
41.6 |
|
Between 6.251 – 8,333 |
62.5 |
|
Between 8,334 – 12,500 |
83.3 |
|
Between 12,501 – 16,667 |
125 |
|
Between 16,668 – 20,833 |
166.6 |
|
More than 20834 |
208.3 |
West Bengal
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 10000 |
0 |
|
Between 10,001 – 15,000 |
110 |
|
Between 15,001 -25,000 |
130 |
|
Between 25,001 – 40,000 |
150 |
|
More than 40001 |
200 |
Tripura
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 5000 |
0 |
|
Between 5001-7000 |
70 |
|
Between 7001-9000 |
120 |
|
Between 9001- 12000 |
140 |
|
Between 12001- 15000 |
190 |
|
More than 15001 |
208 |
Telangana
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 15000 |
0 |
|
Between 15001-20000 |
150 |
|
More than 20001 |
200 |
Tamil Nadu
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 3500 |
0 |
|
Between 3,501 – 5,000 |
22.5 |
|
Between 5,001 – 7,500 |
52.5 |
|
Between 7,501 – 10,000 |
115 |
|
Between 10001-12500 |
171 |
|
More than 12501 |
208 |
Sikkim
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 20000 |
0 |
|
Between 20,001 – 30,000 |
125 |
|
Between 30,001 – 40,000 |
150 |
|
More than 40001 |
200 |
Puducherry
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 16666 |
0 |
|
Between 16,667 – 33,333 |
41.66 |
|
Between 33,334 – 50,000 |
83.33 |
|
Between 50,001 – 66,666 |
125 |
|
Between 66,667 – 83,333 |
166.67 |
|
More than 83334 |
208.33 |
Nagaland
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 4000 |
0 |
|
Between 4,001- 5,000 |
35 |
|
Between 5,001- 7,000 |
75 |
|
Between 7,001- 9,000 |
110 |
|
Between 9001-12000 |
180 |
|
More than 12001 |
208 |
Odisha
|
Salary Per month (Rs.) |
Professional Tax Per Month (Rs.) |
|
Up to 13304 |
0 |
|
Between 13305-25000 |
125 |
|
More than 25001 |
200( For 11 months), 300 (For 12 months) |
How To Pay Professional Tax?
Paying your professional tax can be done using both online and offline methods. To make the payment, you should visit the official website of your respective state. For instance, if you live in Karnataka, you can access the payment portal at https://vat.kar.nic.in/epay/.
Professional tax is a state-specific direct tax, and it is not imposed by the central government. Since it is applicable on a state-by-state basis, the payment process may differ from one state to another.
Procedure to Pay Professional Tax Online?
If you want to pay your professional tax online, follow these steps. Ensure you have your professional tax enrollment number ready.
1. Visit the official website of your state government for professional tax payments. You can easily find it by searching "Professional tax payment" along with your city's name.
2. Look for the Karnataka professional tax tab in the left-side menu, and click on it.
3. You'll be taken to a new page where you must choose between professional tax challan options for registered employers and self-employed professionals.
4. Enter your professional tax payment registration number, company name, and other required information.
5. Select whether you want to pay the tax monthly or annually, following the department's regulations.
6. Specify the relevant year for the tax payment and input the amount due, including any penalties if applicable.
7. Provide your bank details to make the payment and your registered mobile number. Double-check your details for accuracy before submission.
8. Click on "click here for payment" on the next redirected page, which will take you to your bank's net banking page.
9. Sign in and complete the payment for your professional tax. Remember to keep the payment details in a PDF format for future reference.
What Are The Available Exemptions In Professional Tax?
While most individuals with regular incomes need to pay professional tax, there are exceptions. Here's a list to help you determine if you are exempt from paying professional tax:
1. Parents of children with disabilities
2. Foreigners employed by the state government
3. Owners of educational institutions
4. Temporary workers in factories
5. Individuals with physical or mental disabilities like blindness or deafness
6. Members of the Army, Airforce, and Navy
7. Charitable hospitals in areas under the Panchayat Samiti
8. Individuals above 65 years of age
9. Women engaged solely as agents in the government's Mahila Pradhan Kshetriya Bachat Yojana
Penalties For Non-payment For P-Tax
When it comes to professional tax, failing to pay on time can result in penalties. The specific penalty amount can differ from state to state, but late payment typically incurs fines in all states.
Additionally, businesses that don't register or obtain their professional tax registration and enrollment certificates promptly may also face penalties. The exact penalty amount varies by state.
Furthermore, if an individual provides incorrect information about their business to the state government, they can face significant penalties. According to Section 5(6) of the Profession Tax Act, providing false information in the registration or enrollment certificate can lead to a threefold increase in professional tax liabilities.
Therefore, it's crucial to double-check all your details when applying for these professional tax certificates.
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Note-All the aforementioned information in the article is taken from authentic resources and has been published after moderation. Any change in the information other than fact must be believed as a human error. For queries mail us at marketing@myitronline.com
Krishna Gopal Varshney
An editor at MyitronlinenewsKrishna Gopal Varshney, Founder & CEO of Myitronline Global Services Private Limited at Delhi. A dedicated and tireless Expert Service Provider for the clients seeking tax filing assistance and all other essential requirements associated with Business/Professional establishment. Connect to us and let us give the Best Support to make you a Success. Visit our website for latest Business News and IT Updates.
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