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Guide to Professional Tax Return Filing




Professional Tax (PT) is a state-imposed tax on employees, professionals, and trades in India. This tax varies by state and is governed by state-specific laws and regulations. Professional tax returns are mandatory for all registered employers and professionals, depending on the state’s rules. This guide covers the essential aspects of professional tax filing, eligibility, rates, deadlines, penalties, and FAQs.

Governing Act and Rules


  • State-Specific Professional Tax Acts: Each state that imposes professional tax has its own Professional Tax Act and rules.
  • Common Professional Tax Filing Rules:
    • Filing frequency: (monthly, quarterly, or annually) depends on the state.
    • Tax rates and the maximum annual limit: (usually up to ₹2,500) are also state-specific.

Eligibility for Professional Tax Registration and Filing


  • Employers: Employers with salaried employees must register and deduct professional tax from employees’ salaries.
  • Self-Employed Individuals: Professionals such as doctors, lawyers, and freelancers need to register and pay professional tax, depending on the state’s rules.
  • State-Specific Variations:
    • Maharashtra: Professional tax is compulsory for both employees and self-employed professionals.
    • Karnataka and West Bengal: Professionals and business owners with specified income must pay PT.
  • Exemptions: Senior citizens, parents of differently-abled children, and specific classes are exempt in certain states.

Professional Tax Rates and Example Calculation


Professional tax rates vary by state and are generally based on salary slabs or income levels. Here’s a look at some state examples:

  • Maharashtra: ₹200 per month for income above ₹10,000 and ₹300 in February (annual limit ₹2,500).
  • Karnataka: ₹200 per month for income above ₹15,000.
  • West Bengal: Ranges from ₹0 to ₹200 per month based on salary brackets.
    Example Calculation in Maharashtra
  • Monthly Salary: ₹15,000
  • Monthly PT Deduction: ₹200 (for 11 months) + ₹300 (for February)
  • Annual PT: ₹2,500

Step-by-Step Process for TDS Return Filing


  • Step 1

    Register for Professional Tax

    Employer Registration: Employers must register for professional tax with the state’s tax department where their business is based.
    Employee Enrollment: Employers enroll each eligible employee for professional tax.

  • Step 2

    Maintain Payroll and Income Records

    Ensure accurate records of employee salaries and professional tax deductions.
    Calculate monthly or quarterly professional tax based on state rules.

  • Step 3

    File Professional Tax Returns

    Frequency of Filing: Monthly, quarterly, or annual returns, depending on state requirements.
    Forms to File: Varies by state (e.g., Form IIIB in Maharashtra for monthly returns).
    Documentation: Attach salary registers, tax deduction details, and payment proof.

  • Step 4

    Payment of Professional Tax

    Due Dates: The 30th or 31st of each month, or quarterly/annually as specified by the state.
    Mode of Payment: Pay online through the state’s professional tax portal or designated bank.

Professional tax: state-wise slab and due dates


State Tax Deduction Period Salary Calculation Basis Tax Slab Tax Amount to be Paid Deadline for Remitting Tax
Andhra Pradesh Monthly Monthly Up to Rs. 15,000, Rs. 15,001 to Rs. 20,000, Rs. 20,001 and above Nil, Rs. 150, Rs. 200 Pay by 30th June if enrolled by 31st May; otherwise, within one month of enrollment.
Assam Monthly Monthly Up to Rs. 10,000, Rs. 10,001 to Rs. 15,000, Rs. 15,001 to Rs. 24,999, Rs. 25,000 and above Nil, Rs. 150, Rs. 180, Rs. 208 Pay before the 28th of every month.
Bihar Yearly Yearly Up to Rs. 300,000, Rs. 300,001 to Rs. 500,000, Rs. 500,001 to Rs. 1,000,000, Rs. 1,000,001 and above Nil, Rs. 1,000, Rs. 2,000, Rs. 2,500 Pay on or before the end of November every year.
Chhattisgarh Monthly Monthly Up to Rs. 100,000, Rs. 100,001 to Rs. 150,000, Rs. 150,001 to Rs. 200,000, Rs. 200,001 and above Nil, Rs. 130, Rs. 150, Rs. 200 (and Rs. 212 yearly) Pay within ten days of the month end.
Gujarat Monthly Monthly Up to Rs. 12,000, Rs. 12,001 and above Nil, Rs. 200 Pay before the 30th of September if enrolled before the year or before 31st August; else within a month of enrollment.
Jharkhand Quarterly Yearly Up to Rs. 300,000, Rs. 300,001 to Rs. 500,000, Rs. 500,001 to Rs. 800,000, Rs. 800,001 and above Nil, Rs. 100, Rs. 150, Rs. 175, Rs. 208 Pay before 15th May, 16th August, 15th November, and 15th February.
Karnataka Monthly Monthly Up to Rs. 25,000, Rs. 25,001 and above Nil, Rs. 200 Pay before the 20th of the succeeding month.
Kerala Every six months Half-yearly Up to Rs. 11,999, Rs. 12,000 to Rs. 17,999, Rs. 18,000 to Rs. 29,999, Rs. 30,000 and above Nil, Rs. 120, Rs. 180, Rs. 300, Rs. 1,250 Pay by 31st August for first half; by end of February for second half.
Madhya Pradesh Monthly Monthly Up to Rs. 18,750, Rs. 18,751 to Rs. 25,000, Rs. 25,001 to Rs. 33,333, Rs. 33,334 and above Nil, Rs. 125, Rs. 166 & 174, Rs. 208 & 212 Pay by 30th September if registered before 31st August; else within 30 days of registration.
Maharashtra Monthly Monthly Up to Rs. 7,500, Rs. 7,501 to Rs. 10,000, Above Rs. 10,001 Nil, Rs. 175, Rs. 200 & 300* Pay by 30th June if enrolled before 31st May; otherwise, within 30 days of enrollment.
Manipur Yearly Yearly Up to Rs. 50,000, Rs. 50,001 to Rs. 75,000, Rs. 75,001 to Rs. 100,000, Above Rs. 100,001 Nil, Rs. 1,200, Rs. 2,000, Rs. 2,400, Rs. 2,500 Pay before the 30th of March every year.
Meghalaya Monthly Monthly Up to Rs. 4,166, Rs. 4,167 to Rs. 6,250, Rs. 6,251 to Rs. 8,333, Rs. 8,334 and above Nil, Rs. 16.50, Rs. 25, Rs. 41.50, Rs. 208 Pay before the 28th of every month.
Mizoram Monthly Monthly Up to Rs. 5,000, Rs. 5,001 to Rs. 8,000, Rs. 8,001 to Rs. 10,000, Rs. 10,001 and above Nil, Rs. 75, Rs. 120, Rs. 150, Rs. 208 Pay before the 30th of June every year.
Nagaland Monthly Monthly Up to Rs. 4,000, Rs. 4,001 to Rs. 5,000, Rs. 5,001 to Rs. 7,000, Rs. 7,001 and above Nil, Rs. 60, Rs. 90, Rs. 120, Rs. 150 Pay by the 25th of every month.
Odisha Monthly Monthly Up to Rs. 15,000, Rs. 15,001 to Rs. 20,000, Rs. 20,001 and above Nil, Rs. 130, Rs. 200 Pay before the 25th of every month.
Punjab Monthly Monthly Up to Rs. 20,000, Rs. 20,001 to Rs. 30,000, Rs. 30,001 and above Nil, Rs. 200, Rs. 250 Pay before the 25th of every month.
Rajasthan Monthly Monthly Up to Rs. 16,000, Rs. 16,001 to Rs. 25,000, Rs. 25,001 and above Nil, Rs. 150, Rs. 200 Pay before the 28th of every month.
Tamil Nadu Monthly Monthly Up to Rs. 10,000, Rs. 10,001 to Rs. 20,000, Rs. 20,001 and above Nil, Rs. 150, Rs. 200 Pay before the 25th of every month.
Uttar Pradesh Monthly Monthly Up to Rs. 12,000, Rs. 12,001 and above Nil, Rs. 200 Pay before the 30th of every month.
West Bengal Monthly Monthly Up to Rs. 15,000, Rs. 15,001 to Rs. 30,000, Rs. 30,001 and above Nil, Rs. 200, Rs. 250 Pay before the 30th of each month.

Benefits of Professional Tax Compliance


  • Avoidance of Penalties: Regular filing helps avoid state-imposed penalties and interest charges.
  • Business Reputation: Compliance enhances credibility and builds trust with employees and authorities.
  • Tax Deduction: Professional tax paid by employees is deductible under Section 16(iii) of the Income Tax Act.

Penalties and Consequences for Non-Compliance


  • Late Fees: State-imposed fees on delayed PT payments, typically ranging from ₹5 to ₹10 per day.
  • Interest on Arrears: Generally 1-2% per month on unpaid PT dues.
  • Legal Action: Non-compliance may result in further penalties, especially for repeat offenses.

Example of Professional Tax Calculation and Filing


For a Karnataka-based employer with an employee earning ₹20,000 monthly:

  • Monthly PT Deduction: ₹200 (based on state’s PT rates)
  • Annual PT: ₹2,400
  • Return Filing: Filed monthly by the 20th of the following month, accompanied by salary register and payment proof.

Documents Required for Professional Tax Return Filing


  • Employer Registration Certificate: Proof of PT registration.
  • Salary Records: Monthly/quarterly salary data and PT deductions.
  • Proof of PT Payment: Challans or online payment receipts.
  • Employee Enrollments: List of employees eligible for professional tax.

YathraFin’s Professional Tax Return Filing Services


  • Professional Tax Registration and Filing: YathraFin provides registration services and manages filings.
  • Automated Compliance Reminders: Timely reminders for payment and return due dates.
  • Expert Guidance: Simplified processes with dedicated support for state-specific compliance.
FAQ

Frequently Asked Questions

These FAQs cover essential details like eligibility, required documents, process steps, and benefits. It helps clarify common queries about setup, compliance, costs, and timelines.

A tax imposed by state governments on professions, trades, and employment.
States like Maharashtra, Karnataka, Tamil Nadu, and West Bengal mandate PT registration for employers and professionals.
Employers with eligible employees and self-employed professionals must file returns.
Varies by state; commonly monthly, quarterly, or annual.
Only to employees earning above a specific salary threshold, which varies by state.
Up to ₹2,500 annually, based on the state’s salary slabs.
Yes, states may revise rates, thresholds, and slab structures periodically.
Yes, certain states provide exemptions to senior citizens, differently-abled individuals, and others.
Penalties, interest charges, and possible legal action in severe cases.
Yes, it’s typically deducted at source from eligible employee salaries.
Through the respective state’s professional tax portal.
Yes, in states where self-employed professionals are required to pay PT.
No, PT is only applicable to those earning above the state-specified threshold.
Yes, under Section 16(iii) of the Income Tax Act.
YathraFin assists with registration, filing, and compliance for professional tax.
No, PT is non-refundable once paid to the state.
You must apply for PT registration through the state’s tax department.
Yes, employers are responsible for deducting and remitting PT for employees.
No, PT rates, applicability, and filing requirements vary by state.
Some states allow for annual advance payments.


Professional tax compliance can vary widely across states. With YathraFin’s expertise, businesses can streamline professional tax filing and ensure hassle-free compliance with state regulations.

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