Online Professional Tax Registration

Employers and individuals in any profession or trade must register for Professional Tax and obtain a registration certificate. This tax serves as a source of revenue for the state. Registering for this tax has become simple, affordable, and accessible through Filing Buddy.

Professional Tax is a tax imposed and regulated by the State government in India on all salaried individuals, with some exceptions such as Delhi, UP, and Haryana, Rajasthan, Uttarakhand, Punjab, Himachal Pradesh, Jammu and Kashmir, Arunachal Pradesh. It applies to various working professionals, including chartered accountants, doctors, and lawyers, based on their employment or profession. Business owners, freelancers, and others can pay this tax once their income exceeds a certain threshold. The tax rates vary across states, and the maximum Professional Tax that can be imposed is Rs. 2,500 per year.
 

Self-employed individuals in any profession, business, or trade must register for Professional Tax and pay it to the State Government. The Commercial Taxes Department is responsible for collecting this tax; the tax slabs vary from state to state. The tax amount is calculated based on the annual taxable income of the professionals, and it can be paid either annually or monthly. Self-employed individuals must obtain a certificate of enrollment in the specified format from the authorized authority, which is mandatory.

In the case of salaried individuals or wage earners, their employer deducts Professional Tax from their monthly salary. However, the employer cannot deposit the deducted amount without obtaining the registration certificate from the respective authority.

Here are some compelling reasons why one should never miss paying Professional Tax:

• Firstly, Professional Tax registration is a legal requirement in India, and failure to comply with it can result in penalties or legal issues. Self-employed individuals and employers must pay their Professional Tax within the prescribed time, based on their respective state's rates or wages.
• Secondly, complying with Professional Tax is simple and easy. The rules and regulations governing Professional Tax impose minimal restrictions, and the registration process is straightforward. Monthly or annual compliances are uncomplicated, making it hassle-free for individuals.
• Thirdly, individuals can claim a deduction for the Professional Tax paid earlier.
• Lastly, as a state tax, Professional Tax is a local tax authority's obligation to deduct Professional Tax from the fees of professionals, business income, and salary.

Professional Tax applies to the following categories of individuals in the states where they work:

• Hindu Undivided Family (HUF)
• Individuals
• One Person Company/Private/Public
• Co-operative Society
• Body of Individuals
• Association of Person

Professional Tax is charged at a predetermined slab rate either monthly or annually by the Commercial Tax Department of the respective state. Self-employed individuals can pay Professional Tax directly online. In contrast, for salaried individuals, the employer must deduct the Professional Tax and deposit it with the respective State Government.

In addition, self-employed individuals must obtain a Certificate of Enrollment from the tax department of the respective state.

To obtain a Professional Tax Registration Certificate, follow the below-mentioned steps:

1. Apply for a PTRC registration certificate online through the official portal of the Commercial Taxes Department (CTD).
2. Submit the application form along with all necessary scanned documents.
3. Alternatively, one can apply for the Professional Tax Registration Certificate offline by submitting the application along with the necessary documents directly to the concerned State Government and the prescribed fee.
4. Upon receipt of the application, the concerned Tax authority will scrutinize it for verification.
5. After verification, the Tax authority will approve the application and grant the Professional Tax Registration Certificate to the applicant.
6. If there are any application flaws, the Tax Department can raise a query, which must be responded to within the prescribed time.

Individuals who do not submit their professional tax are subject to penalties. All states penalize individuals who do not register for professional tax even after it becomes applicable. The penalty amount for not submitting professional tax returns varies from state to state. A penalty of Rs.5/- per day is imposed for late registration of the tax enrollment certificate. And a penalty of 10% of the amount of tax is imposed for non-payment or late payment of professional tax. If an individual files the returns late, they have to pay a penalty of Rs.1000 and after a month, the penalty increases to Rs.2000.