Professional tax needs to be deducted from the salary or wages paid amount.Professional Tax Registration is mandatory within 30 days of employing staff in a business or, in the case of professionals, 30 days from the start of the practice.
Professional Tax is a tax levied by the state on the income earned by employees on rendering their specific services.Just like the income tax, the professional tax is linked to the income slabs. It is deducted at the source by the employer. It is a nominal tax and never exceeds a few hundred rupees a month. The maximum amount of Professional Tax that any state can impose in India is ₹2500.The professional tax applies to employees of almost all industries. It’s also applicable to professionals like doctors, chartered accountants (CAs), consultants, traders, and other self-employed individuals.The employer is responsible for registering, deducting, and paying the professional tax to the government regularly for employees and wage earners. Failure to comply has consequences like fines and penal tax.Every state has its own laws and regulation to govern professional tax of that particular state.
Applies to all Indian service providers (including freelancers), traders and manufacturers.
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A person earning an income from salary or anyone practicing a profession such as chartered accountant, company secretary, lawyer, doctor etc. are required to pay this professional tax online.
Normally you can pay between 1st April to 30th September every year.
You should enroll and pay profession tax at each designated authority under which your branch is located.
Designated authority has power to recover such amount from the assets of thedefaulter. It can also attach bank account
of such defaulter. Lastly, prosecution case(police case) can also be filed under the provisions of the Act.
Enrolment should be done within 60 days from the date on which liability has arisen
The maximum amount of professional tax levied by a state is Rs. 2,500 which is allowed as a deduction from your salary.
Employers collect a certain amount as professional tax from the monthly salaries of their employees. This portion is then paid by the employer to the government. In case they fail to do so, they can be subject to penalties for not collecting or failing to pay the professional tax. Also, if you do it for anyone, then you are liable to pay the professional tax yourself.
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