Professional Tax Registration Process and Returns

Professional Tax Registration Process and Returns. Professional tax is a direct tax imposed on individuals earning an income through practicing a profession, employment, or running a trade. Unlike income tax, which is levied by the Central Government, professional tax is collected by state governments or union territories in India. For salaried individuals, employers deduct professional tax from their salaries and remit it to the state government. Self-employed individuals are responsible for paying this tax themselves. While the tax rates and slabs vary across different states, the maximum annual amount is capped at ?2,500. As a business owner in India, it is mandatory to comply with various statutory requirements, including the payment of professional tax, which is a direct tax levied by state governments on individuals earning an income through a profession, employment, calling, or trade.
Professional tax applies to various entities, including:
• Individuals
• Hindu Undivided Families (HUFs)
• Companies, firms, co-operative societies
• Associations of persons or bodies of individuals, whether incorporated or not
Professionals such as lawyers, teachers, doctors, and chartered accountants are required to pay professional tax on their income.
To help you by guiding the state-wise rules of professional tax, we’ve prepared a comprehensive guide covering:
1. What is Professional Tax and Applicability?
2. State-wise Rules of Professional Tax
3. How to Pay Professional Tax
What is Professional Tax & Applicability?
Professional tax is imposed by the commercial tax department of each state on individuals who earn a wage. Employers must deduct this tax before processing their employees' salaries. Each state has its regulations, slab rates, and deadlines, with a maximum annual tax of Rs. 2,500 per individual. Out of the 28 states and 6 union territories in India, professional tax is applicable in 21 states and 1 union territory.
Learn States Imposing Professional Tax & Professional Tax Rates
Professional tax is levied in several Indian Applicable States:
• Andhra Pradesh
• Assam
• Bihar
• Gujarat
• Jharkhand
• Karnataka
• Kerala
• Madhya Pradesh
• Maharashtra
• Manipur
• Meghalaya
• Mizoram
• Nagaland
• Odisha
• Pondicherry
• Punjab
• Sikkim
• Tamil Nadu
• Telangana
• Tripura
• West Bengal
Non-Applicable States:
• Andaman and Nicobar Islands
• Arunachal Pradesh
• Chandigarh
• Chhattisgarh
• Dadra and Nagar Haveli
• Daman and Diu
• Delhi
• Goa
• Haryana
• Himachal Pradesh
• Jammu and Kashmir
• Ladakh
• Lakshadweep
• Rajasthan
• Uttar Pradesh
• Uttarakhand
Professional Tax Rates
The maximum professional tax payable per year is ?2,500, typically deducted monthly based on the individual’s gross income. The tax is collected by the Commercial Taxes Department of the respective state or union territory, adhering to predetermined slabs and learning more statewide

Deduction Period

Salary Range (?)

Tax Amount (?)

Payment Deadline

Penalties

Monthly

Up to 15,000

Nil

Depends on the enrollment date

15,001 - 20,000

150

Before 30th June / within a month

Above 20,000

200

Monthly

Up to 10,000

Nil

Before the 28th of every month

10,001 - 15,000

150

15,001 - 24,999

180

Above 25,000

208

Yearly

Up to 300,000

Nil

Before the end of November

A fine of ?500

300,001 - 500,000

1,000

500,001 - 1,000,000

2,000

Above 1,000,000

2,500

Monthly

Up to 100,000

Nil

Within ten days of the month's end

A fine of 2% of the due amount, max 2/3 of total

100,001 - 150,000

130

150,001 - 200,000

150

200,001 - 250,000

200

Above 250,000

208 (212 in last month)

Monthly

Up to 12,000

Nil

Before 30th September / within a month

Above 12,000

200

Quarterly

Up to 300,000

Nil

15th May, Aug, Nov, Feb

300,001 - 500,000

100

500,001 - 800,000

150

800,001 - 1,000,000

175

Above 1,000,000

208

Monthly

Up to 15,000

Nil

Before 30th April

Fine up to 50% of the due amount

Above 15,000

200

Semi-Annually

Up to 11,999

Nil

31st August/end of February

A fine of ?5,000 and a 1% penalty per month

12,000 - 17,999

120

18,000 - 29,999

180

30,000 - 44,999

300

45,000 - 59,999

450

60,000 - 74,999

600

75,000 - 99,999

750

100,000 - 124,999

1,000

Above 125,000

1,250

Monthly

Up to 18,750

Nil

Before 30th September / within 30 days

2% per month of due amount

18,751 - 25,000

125

25,001 - 33,333

166 (174 in last month)

Above 33,334

208 (212 in last month)

Monthly

Up to 7,500

Nil

Before 30th June / within 30 days

10% of the total due amount

7,501 - 10,000

175

Above 10,001

200 (300 in last month)

Yearly

Up to 50,000

Nil

Before 30th March

50,001 - 75,000

1,200

75,001 - 100,000

2,000

100,001 - 125,000

2,400

Above 125,000

2,500

Monthly

Up to 4,166

Nil

Before the 28th of every month

2% of the due amount, up to 10% of total

4,167 - 6,250

16.5

6,251 - 8,333

8,334 - 12,500

41.5

12,501 - 16,666

62.5

16,667 - 20,833

83.33

20,834 - 25,000

104.16

25,001 - 29,166

125

29,167 - 33,333

150

33,334 - 37,500

175

37,501 - 41,666

200

Above 41,667

208

Monthly

Up to 5,000

Nil

Before 30th June

5,001 - 8,000

8,001 - 10,000

120

10,001 - 12,000

150

12,001 - 15,000

180

Above 15,001

208

Monthly

Up to 4,000

Nil

Before 30th September / within a month

4,001 - 5,000

5,001 - 7,000

7,001 - 9,000

110

9,001 - 12,000

180

Above 12,001

208

Monthly

Up to 159,999

Nil

End of the succeeding month

160,000 - 300,000

125

Above 300,000

200 (300 in last month)

Semi-Annually

Up to 99,999

Nil

Before 30th June / 31st December

100,000 - 200,

with due dates for quick understanding:-
Payment Responsibility
For salaried employees, employers must deduct and deposit professional tax to the state government. Self-employed individuals are required to pay the tax directly to the government. Employers must also file returns, providing proof of payment to avoid penalties.
Exemptions from Professional Tax
Certain individuals are exempt from paying professional tax, including:
• Parents of children with permanent disabilities
• Members of the armed forces, including auxiliary forces and reservists
• Badli workers in the textile industry
• Individuals with permanent physical disabilities, including blindness
• Women agents under the Mahila Pradhan Kshetriya Bachat Yojana or Small Savings Directors
• Parents or guardians of individuals with mental disabilities
• Individuals above 65 years of age
Registration and Compliance
Professionals must register for professional tax within 30 days of starting their practice or employing staff. The application for registration must be submitted to the state tax department, and separate applications are required for each workplace under different jurisdictions.
Documents and Details
For Individual / Proprietorship:
• Proof of Address: Light Bill for owned shop or business premises; Rent Agreement for leased premises.
• PAN Card of the Individual.
• Aadhaar Card of the Individual.
• 2 Passport-size photos of the proprietor.
• Signature on Blank Paper for record and verification.
• Canceled cheque / Bank Statement.
• Employee details and salary records
For Company/Firm:
• Copy of Memorandum of Association (MOA) of the Company
• Copy Article of Association (AOA) of the Company
• Proof of Address: Light Bill for owned business premises; Rent Agreement for leased premises
• PAN of the Company / Firm
• Copy of PAN of Directors
• Copy of the Aadhaar card of the Director
• 2 Passport size photos of authorized persons/signatories
• Authorization Letter by signatories
• Board Resolution passed for this purpose
• Signature on Blank Paper for record and verification
• Canceled cheque / Bank Statements
• Employee details and salary records
Payment and Filing Deadlines
Employers with over 20 employees must pay the tax within 15 days of the month's end, while those with fewer employees must pay quarterly. The filing deadlines for returns vary by state.
Penalties for Non-Compliance
Failure to register, pay, or file returns on time can result in penalties, which vary by state. For instance, in Maharashtra, the penalties for non-registration are ?5 per day, late return filing is ?1,000, and late payment incurs interest at 1.25% per month plus a 10% penalty.
Benefits of Professional Tax Registration
Registering for professional tax offers several advantages:
• Simplified compliance and a smooth registration process
• Avoidance of penalties and legal action
• Revenue for state governments to fund welfare schemes
• Deductible professional tax payments for employers and self-employed individuals
Registration Procedure
The application process varies by state but generally involves:
• Applying with necessary documents to the state government and tax department
• Scrutiny of the application by the tax authority
• Issuance of the Professional Tax Certificate upon successful verification
Penalties for Late Compliance
Penalties for late payment or filing include fines and interest charges, which differ by state regulations.
Seamless Registration with India Filings
Compliance Calendar LLP, assistance in obtaining a Professional Tax Registration Certificate (PTRC), ensuring compliance and timely processing, includes:
• Expert guidance and compliance assurance
• Application submission to relevant authorities
• Timely processing to avoid delays
• Customized support tailored to your professional needs
• Ongoing customer support to address queries and concerns
Through Compliance Calendar LLP, you can simplify the PT registration process hassle-free including good experiences, ensuring you meet all professional tax obligations efficiently.

Professional tax is a direct tax imposed on individuals earning an income through practicing a profession, employment, or running a trade. Unlike income tax, which is levied by the Central Government, professional tax is collected by state governments or union territories in India. For salaried individuals, employers deduct professional tax from their salaries and remit it to the state government. Self-employed individuals are responsible for paying this tax themselves. While the tax rates and slabs vary across different states, the maximum annual amount is capped at ?2,500. As a business owner in India, it is mandatory to comply with various statutory requirements, including the payment of professional tax, which is a direct tax levied by state governments on individuals earning an income through a profession, employment, calling, or trade.

Professional tax applies to various entities, including:

• Individuals

• Hindu Undivided Families (HUFs)

• Companies, firms, co-operative societies

• Associations of persons or bodies of individuals, whether incorporated or not

Professionals such as lawyers, teachers, doctors, and chartered accountants are required to pay professional tax on their income.

To help you by guiding the state-wise rules of professional tax, we’ve prepared a comprehensive guide covering:

1. What is Professional Tax and Applicability?

2. State-wise Rules of Professional Tax

3. How to Pay Professional Tax

What is Professional Tax & Applicability?

Professional tax is imposed by the commercial tax department of each state on individuals who earn a wage. Employers must deduct this tax before processing their employees' salaries. Each state has its regulations, slab rates, and deadlines, with a maximum annual tax of Rs. 2,500 per individual. Out of the 28 states and 6 union territories in India, professional tax is applicable in 21 states and 1 union territory.

Learn States Imposing Professional Tax & Professional Tax Rates

Professional tax is levied in several Indian Applicable States:

• Andhra Pradesh

• Assam

• Bihar

• Gujarat

• Jharkhand

• Karnataka

• Kerala

• Madhya Pradesh

• Maharashtra

• Manipur

• Meghalaya

• Mizoram

• Nagaland

• Odisha

• Pondicherry

• Punjab

• Sikkim

• Tamil Nadu

• Telangana

• Tripura

• West Bengal

Non-Applicable States:

• Andaman and Nicobar Islands

• Arunachal Pradesh

• Chandigarh

• Chhattisgarh

• Dadra and Nagar Haveli

• Daman and Diu

• Delhi

• Goa

• Haryana

• Himachal Pradesh

• Jammu and Kashmir

• Ladakh

• Lakshadweep

• Rajasthan

• Uttar Pradesh

• Uttarakhand

Professional Tax Rates

The maximum professional tax payable per year is ?2,500, typically deducted monthly based on the individual’s gross income. The tax is collected by the Commercial Taxes Department of the respective state or union territory, adhering to predetermined slabs and learning more statewide

Deduction Period	Salary Range (?)	Tax Amount (?)	Payment Deadline	Penalties
Monthly	Up to 15,000	Nil	Depends on the enrollment date	-
	15,001 - 20,000	150	Before 30th June / within a month
	Above 20,000	200
Monthly	Up to 10,000	Nil	Before the 28th of every month	-
	10,001 - 15,000	150
	15,001 - 24,999	180
	Above 25,000	208
Yearly	Up to 300,000	Nil	Before the end of November	A fine of ?500
	300,001 - 500,000	1,000
	500,001 - 1,000,000	2,000
	Above 1,000,000	2,500
Monthly	Up to 100,000	Nil	Within ten days of the month's end	A fine of 2% of the due amount, max 2/3 of total
	100,001 - 150,000	130
	150,001 - 200,000	150
	200,001 - 250,000	200
	Above 250,000	208 (212 in last month)
Monthly	Up to 12,000	Nil	Before 30th September / within a month	-
	Above 12,000	200
Quarterly	Up to 300,000	Nil	15th May, Aug, Nov, Feb	-
	300,001 - 500,000	100
	500,001 - 800,000	150
	800,001 - 1,000,000	175
	Above 1,000,000	208
Monthly	Up to 15,000	Nil	Before 30th April	Fine up to 50% of the due amount
	Above 15,000	200
Semi-Annually	Up to 11,999	Nil	31st August/end of February	A fine of ?5,000 and a 1% penalty per month
	12,000 - 17,999	120
	18,000 - 29,999	180
	30,000 - 44,999	300
	45,000 - 59,999	450
	60,000 - 74,999	600
	75,000 - 99,999	750
	100,000 - 124,999	1,000
	Above 125,000	1,250
Monthly	Up to 18,750	Nil	Before 30th September / within 30 days	2% per month of due amount
	18,751 - 25,000	125
	25,001 - 33,333	166 (174 in last month)
	Above 33,334	208 (212 in last month)
Monthly	Up to 7,500	Nil	Before 30th June / within 30 days	10% of the total due amount
	7,501 - 10,000	175
	Above 10,001	200 (300 in last month)
Yearly	Up to 50,000	Nil	Before 30th March	-
	50,001 - 75,000	1,200
	75,001 - 100,000	2,000
	100,001 - 125,000	2,400
	Above 125,000	2,500
Monthly	Up to 4,166	Nil	Before the 28th of every month	2% of the due amount, up to 10% of total
	4,167 - 6,250	16.5
	6,251 - 8,333	25
	8,334 - 12,500	41.5
	12,501 - 16,666	62.5
	16,667 - 20,833	83.33
	20,834 - 25,000	104.16
	25,001 - 29,166	125
	29,167 - 33,333	150
	33,334 - 37,500	175
	37,501 - 41,666	200
	Above 41,667	208
Monthly	Up to 5,000	Nil	Before 30th June	-
	5,001 - 8,000	75
	8,001 - 10,000	120
	10,001 - 12,000	150
	12,001 - 15,000	180
	Above 15,001	208
Monthly	Up to 4,000	Nil	Before 30th September / within a month	-
	4,001 - 5,000	35
	5,001 - 7,000	75
	7,001 - 9,000	110
	9,001 - 12,000	180
	Above 12,001	208
Monthly	Up to 159,999	Nil	End of the succeeding month	-
	160,000 - 300,000	125
	Above 300,000	200 (300 in last month)
Semi-Annually	Up to 99,999	Nil	Before 30th June / 31st December	-
	100,000 - 200,

with due dates for quick understanding:-

Payment Responsibility

For salaried employees, employers must deduct and deposit professional tax to the state government. Self-employed individuals are required to pay the tax directly to the government. Employers must also file returns, providing proof of payment to avoid penalties.

Exemptions from Professional Tax

Certain individuals are exempt from paying professional tax, including:

• Parents of children with permanent disabilities

• Members of the armed forces, including auxiliary forces and reservists

• Badli workers in the textile industry

• Individuals with permanent physical disabilities, including blindness

• Women agents under the Mahila Pradhan Kshetriya Bachat Yojana or Small Savings Directors

• Parents or guardians of individuals with mental disabilities

• Individuals above 65 years of age

Registration and Compliance

Professionals must register for professional tax within 30 days of starting their practice or employing staff. The application for registration must be submitted to the state tax department, and separate applications are required for each workplace under different jurisdictions.

Documents and Details

For Individual / Proprietorship:

• Proof of Address: Light Bill for owned shop or business premises; Rent Agreement for leased premises.

• PAN Card of the Individual.

• Aadhaar Card of the Individual.

• 2 Passport-size photos of the proprietor.

• Signature on Blank Paper for record and verification.

• Canceled cheque / Bank Statement.

• Employee details and salary records

For Company/Firm:

• Copy of Memorandum of Association (MOA) of the Company

• Copy Article of Association (AOA) of the Company

• Proof of Address: Light Bill for owned business premises; Rent Agreement for leased premises

• PAN of the Company / Firm

• Copy of PAN of Directors

• Copy of the Aadhaar card of the Director

• 2 Passport size photos of authorized persons/signatories

• Authorization Letter by signatories

• Board Resolution passed for this purpose

• Signature on Blank Paper for record and verification

• Canceled cheque / Bank Statements

• Employee details and salary records

Payment and Filing Deadlines

Employers with over 20 employees must pay the tax within 15 days of the month's end, while those with fewer employees must pay quarterly. The filing deadlines for returns vary by state.

Penalties for Non-Compliance

Failure to register, pay, or file returns on time can result in penalties, which vary by state. For instance, in Maharashtra, the penalties for non-registration are ?5 per day, late return filing is ?1,000, and late payment incurs interest at 1.25% per month plus a 10% penalty.

Benefits of Professional Tax Registration

Registering for professional tax offers several advantages:

• Simplified compliance and a smooth registration process

• Avoidance of penalties and legal action

• Revenue for state governments to fund welfare schemes

• Deductible professional tax payments for employers and self-employed individuals

Registration Procedure

The application process varies by state but generally involves:

• Applying with necessary documents to the state government and tax department

• Scrutiny of the application by the tax authority

• Issuance of the Professional Tax Certificate upon successful verification

Penalties for Late Compliance

Penalties for late payment or filing include fines and interest charges, which differ by state regulations.

Seamless Registration with India Filings

Compliance Calendar LLP, assistance in obtaining a Professional Tax Registration Certificate (PTRC), ensuring compliance and timely processing, includes:

• Expert guidance and compliance assurance

• Application submission to relevant authorities

• Timely processing to avoid delays

• Customized support tailored to your professional needs

• Ongoing customer support to address queries and concerns

Through Compliance Calendar LLP, you can simplify the PT registration process hassle-free including good experiences, ensuring you meet all professional tax obligations efficiently.