Business owners must comply with many state and central regulations regarding licenses and taxes. Professional taxes are one state obligation. The amount payable varies slightly in each state, and this is a state tax. In order to ensure your business collects and pays the correct professional tax each month, you need to follow these steps.
Two certificates are required for business registration:
Certificate of professional tax registration (PTRC) Certificate of professional tax enrolment (PTEC)
1.In Maharashtra, you need to first register on the government website and obtain your ‘registration certificate’. Every state has its own professional tax rules. A professional tax enrolment certificate will be issued once you have registered and your registration request has been verified by officials. Your employees can deduct professional tax and make payments once you receive the professional tax enrolment certificate.
- Calculation of professional tax payable Calculation of professional tax payable is based on the gross salary for that month. For example, if an employee receives Rs. 50,000 a month in pay, the gross salary is calculated by subtracting the EPF, gratuity, leave deduction, and loan repayments from the CTC. As an example, let’s assume the gross salary is Rs. 40,000 after deductions. Depending on the professional tax rules in Maharashtra, a business owner will need to deduct Rs. 200 towards professional taxes on Rs. 40,000. However, the deduction will be Rs. 300 in March.
- Rules for deduction of professional tax from employees Professional tax is calculated based on predetermined slabs, but every employee working in the business must pay professional tax. Your responsibility as a business owner is to deduct professional tax and pay it to the government. Since professional tax payments are based on the income level and minimum wage parameters of each state, they differ between states in terms of rules and professional tax registration number
- Professional tax registration in different states States offer the convenience of both online and offline registration for professional tax. Visit their taxes website and select the respective link.ies. In order to visit the government office, you will need to submit some business-related documents.
5.Payment of professional taxes can be made online or in person at the local state tax office. Professional taxes are collected via net banking by each state. To make a payment, you must set up the necessary banking facilities, then visit the government tax department website. Professional taxes are collected to provide the infrastructure for running your business. They were introduced in 1949 and last revised in 1988. You should be aware that a state can collect a maximum of Rs. 2,500 as professional tax from each employee. Keep your business running smoothly by complying with state laws and paying professional tax as required.
Frequently Asked Questions
Q: What is the registration number under the Tamil Nadu Professional Tax Act?
The Tamil Nadu Professional Tax Act requires the filing of Form 1.
Q: Are professionals the only ones subject to professional taxes?
The income-based tax applies to all types of employment, professions, and trades.
- Act on Tamil Nadu Profession Tax
- All About Professional Tax in India
- The Penalties For Not Paying Tax On Time Professional Tax