Professional Tax: All you Need to Know

Professional Tax

You will see a tiny deduction each month on your paycheck, along with others. Under the professional tax bracket, this deduction is currently around 200/- Rs.

The professional tax differs from state to state, and some jurisdictions do not allow deductions under this tax.

In accordance with the Constitution of India, the provisions of this Act shall govern the assessment and collection of the occupation tax. The rate referred to in the third column of the Schedule for the class of these persons is payable to the State by all persons engaged in a profession, company, call, or job described in the second column of the Schedule. As stated in the schedule, section 23 applies only when notified of the time to specified groups of persons.

How does the professional tax work?

India’s state governments collect and levy professional tax. It is an indirect tax. Those who earn wage incomes or practitioners, such as accountants, attorneys, physicians, etc., are required to pay this fee. Collection rates and processes vary from state to state. The professional tax in India is imposed every month.

However, not all nations impose this tax. In addition to Punjab, Uttar Pradesh, Karnataka, Bihar, western Bengal, Andhra Pradesh, Telangana, Maharashtra, Tamil Nadu, and Gujarat, professional taxes are charged in these states. Entrepreneurs, workers, traders, and people with various types of jobs must pay this tax.

Gujarat pays its professional tax quarterly. PT tax must be paid within fifteen days after the end of the month for companies with fewer than 20 employees. The company or company may have to pay a quarterly professional tax if it has more than 20 employees. Likewise, it must be completed within 15 days of the last quarter of the previous year.

  • Employees should apply for registration with their tax offices within 30 days of their appointment.
  • It is the responsibility of every employee to file their taxes within 30 days of their appointment.
  • Applicants who own more than one corporation must file separate applications for each authority in each jurisdiction if applicable laws and regulations apply.

Documents required for registration

  1. The certificate of incorporation
  2. Proof of address    
  3. Accounts records
  4. Payslips and salary information
  5. Several employees are working. 

Gujarat Professional Tax Slabs

According to the monthly salary of each professional tax payer, they pay a certain amount each month. In trade and businesses, professional tax is paid by employers, rather than the taxpayer.

Monthly Income of the TaxPayer

Below Rs. 5999

Rs. 6000 to Rs. 8999 Rs. 9000 to Rs. 11999 Rs 12000 and above
NIL Rs. 80 Rs. 150

    Rs. 200

Penalty for late payments

Currently, these are applicable:

  • The deadline for paying tax when you have fewer than 20 employees is the 15th of the following month.
  • Taxes for businesses with more than 20 employees must be paid before the 15th of the month following the end of the quarter.

These are the due dates for the quarterly payment of professional taxes 

  • 15th July (for April to June quarter), 
  • 15th October (for July to September quarter), 
  • 15th January (for October to December quarter) and 
  • 15th April (from January to March quarter).

Gujarat imposes a daily penalty of 18% on unpaid tax for professional tax late payments.

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