Everything You Know About Professional Tax Payments

What is Professional Tax?

Professional Tax is a direct tax which is levied monthly by most Indian State Governments on your income from salary, trade, profession or calling.

Under Clause (2) of Article 276 of the Constitution of India,1949, state governments were given the power to come up with slabs for income and the corresponding professional tax amounts. Till date, the maximum Professional Tax amount that can be levied by any state government is INR 2,500. 

Who needs to pay the professional tax

Professional tax payment is a revenue source for the government. The maximum amount for professional tax online payment per annum is Rs 2,500 and if salaried, follows the declared pre-determined professional tax slab schedule.

Traders, architects, company secretaries, lawyers, doctors, chartered accountants etc. have to mandatorily make a professional tax payment to the Commercial tax department of the state.

Private company employees also need to pay professional tax payment/e payment. Generally, this deduction is made based on the professional tax slab defined by the government every month. The employer is responsible to remit the professional tax payment amounts collected to the state exchequer using a professional tax online payment method.

In the case of a company, its partners, directors, self-employed professionals, and owners of trading firms the tax may be fixed on the turnover basis or on a fixed amount of Rs 2,500 per annum irrespective of turnover.

Professional tax registration and process

1. The system enables recorded data to be done all at once or in batches.
2. Keep a completed APPT Form on hand in case of emergency. Forms may be found on the webpage, www.apct.gov.in. This will aid in data input speed.
3. Keep visiting www.apct.gov.in – APPT Enrollment Process for the process and documentation to be submitted with the petition.
4. Go to www.apct.gov.in. Select eRegistration or Professional Tax. The system will launch a new browser for mail enrollment and password retrieval.

a. Password may be obtained by clicking here. A new tab will appear.
b. Enter your email address
c. Verify your email
d. Put in the authorization number
e. Press the Submit button. The system delivers the password to your email address. Enter your email and see your password, then return to this website and select “eRegistration” on the page www.apct.gov.in. The system will display the Login Credentials.
f. Enter your email address.
g. Put in the password you got in your email id.
h. Press the Submit button. A new tab will appear.
i. Select “New Registration.” The Complete The registration Option will appear.

Professional Tax slabs in various states

Professional taxes differ from one jurisdiction to the next. As a result, it varies from state to state. Every jurisdiction has its unique set of guidelines that regulate professional taxes in that jurisdiction. To charge occupational tax, all regions use a slab method based on earnings.

Since Professional Tax is a compulsory tax for individuals with an income, most Indian states levy a professional tax. While states like Maharashtra and Karnataka require a professional tax, Haryana and Delhi do not.

Here’s a list of tax slabs in different states:

How to make a professional tax e payment:

To pay the professional tax payment one has to register with the Commercial Tax Department and obtain a professional tax payment number or Enrollment Certificate (EC).

The payment of professional tax can also be made through a paper professional tax challan at the District Sales Tax Office where you may have to fill in the professional tax challan, have it stamped and sealed and make a cash payment at the counter or by cheque, as directed by the department.

A professional tax e payment can also be made online by using the new EC and RC numbers to make e-payments through a professional tax challan. Making a professional tax online payment or e-payment based on the professional tax slab is advantageous as one does not need to visit the PT office every month or even to download the PT Enrolment Certificate online.

Making Online Professional Tax Payment:

If you have your professional tax payment/enrollment number handy you can pay online use this professional tax online payment step-by-step guide.

• Use only the official state government professional tax website to make a professional tax e payment.
• To find the portal search online with ‘Professional tax payment’ and city name.

• Use the left-side menu bar to click on Karnataka Professional Tax-KTP tab assuming you are in Karnataka.
• The website will direct you to choose between professional tax challan options of a registered employer and self-employed professional.
• Now enter your Professional Tax Payment Registration Number, company name, and details as prompted.

• Then choose the option from monthly or annually, depending on the demands of the department and rules.
• Next, enter the month and year for which you are paying the tax.
• Enter the professional tax payment amount column and the penalty if any is levied.
• Enter the bank details from which you propose to make the payment and your registered mobile number.
• Hit the enter tab and verify your details before you click on the submit tab.
• On the next screen that loads click on the tab that says ‘Click here for payment’.
• It will take you to your bank’s net banking page.

• Sign in and make the payment for the due professional tax payment.
• Save the transaction details and professional tax challan in pdf format for future reference.

The penalty clause:

Paying the online professional tax payment in time is important. Non-compliance is penalized at 10 per cent of the due online p tax payment. A delay in obtaining the registration number is penalized mostly at the rate of Rs 5/- per day from the missed date. To file late returns of the professional tax online payment you are levied a penalty of Rs 1,000/- if you pay within a month of the due date or Rs 2,000/- if it is over a month and later.

Professional Tax slabs in different states

Before we get into the details of the Professional Tax slabs for each State, let’s look at Union Territories and States that do not levy PT.

Here are the income slabs and corresponding PT amounts for States and Union Territories where Professional Tax is applicable.