Profession tax is levied and collected by the Commercial Taxes Department of State Governments, in some states by particular Municipal Corporations and majority of the Indian states are collecting this tax. Profession tax is the tax levied and collected by the state governments in India. It is a indirect tax.
Professional Tax Applicability
Applicability of Profession Tax as per the Constitution of India: Article 276 of the Constitution of India provides that “there shall be levied and collected a tax on professions, trades, callings and employments, in accordance with the provisions of this Act. Every person engaged in any profession, trade, calling or employment and falling under one or the other of the classes mentioned in the second column of the Schedule shall be liable to pay to the State Government tax at the rate mentioned against the class of such persons in the third column of the said Schedule. Provided that entry 23 in the Schedule shall apply only to such classes of persons as may be specified by the State Government by notification from time to time.
Steps involved in Online Professional Tax Registration
- First Working Day:-Within one working day, you will have to provide your PAN card, address proof and identity proofs of all the directors/partners/proprietors of the company. You also need to furnish the details of all employees working under you.
- Second Working Day:-The application form for professional tax will be then filled up by the employees and then submitted to the concerned authorities by our expert affiliates. If the documents are all provided in order, then the process will not take more than two working days.
- Seven Working Days:-Within five to seven working days, the basic acknowledgment will be provided by us. In case the documents are not in proper order, the inspector will ask for the missing documents. As soon as you provide the missing ones, the process will be completed. The registration hard copy will be issued within 10 days in all the major cities. In other places, it might take up to 15 to 20 working days.
Qus:-1.What is the difference between a professional tax and income tax?
Income tax is a direct tax collected by the central government from all taxpayers. It is charged on a certain percentage of their income. Whereas, professional tax is an indirect tax collected by the state government. It is charged based on a slab for people engaged in business, occupation, or employment.
Qus:-2.What are the consequences of Professional Tax violation?
Though the actual penal interest or penalty can change according to each state’s legislation board, all states will be charged a penalty if they have not registered after the professional tax legislation is made applicable. Also, penalties will be charged if the payments are not made within the due date or if the return is not filed within the due date specified.
Qus:-3.How can I know the amount of Professions Tax payable by me?
The amount of Professions Tax payable by a person is mentioned in the Professions Tax schedule as Gazette Notification.