Professional Tax Return Filing is mandatory for individuals and businesses liable to pay Professional Tax. Professional Tax is a tax levied by the State Government on salaried individuals, professionals, or persons engaged in any trade, calling, or employment. In contrast, Professional Tax Return is a document filed with the state government containing details of the Tax paid by the individual or business.
Filing Professional Tax Returns can be a complex and time-consuming process. tax zenith provides Professional Tax Return Filing services to assist clients in fulfilling their tax obligations. Our team of experts at tax zenith ensures that the entire process of PT return filing is completed promptly and hassle-free. We provide end-to-end assistance for PT annual return, from the collection of documents to the submission of the tax return and payment of Professional Tax. Contact us today to avail of our PT return filing service and ensure compliance with the rules and regulations of the state government.

Professional Tax

Professional Tax is a form of direct taxation imposed on individuals who earn an income through employment, profession, calling, or trade, unlike the income tax that the Central Government levies, Professional Tax is imposed by the government of a particular state or union territory in India.

For salaried and wage-earning individuals, the employer is responsible for deducting the professional Tax from the salary or wages and depositing it with the state government. However, in the case of other individuals, they must to pay the professional Tax themselves. The calculation of Tax and the amount collected may differ from one state to another, but there is a maximum limit of Rs. 2500 per year.

Professional Tax Return

A professional Tax Return is a document that must be filed by individuals or businesses liable to pay Professional Tax. It is a form that contains details of the Income earned by the individual or business and the Tax paid during the financial year, applicable for PT annual return. The Professional Tax Return filing is filed with the relevant state government department...

Professional Tax Return Applicability

PT return filing is mandatory for all individuals and businesses liable to pay Professional Tax as per the rules and regulations of the state government. The tax liability and filing frequency may vary from state to state.

For salaried and wage-earning individuals, the employer is responsible for deducting the Professional Tax from the salary or wages and depositing it with the state government. However, in the case of other individuals, they must to pay the Professional Tax themselves and file the return accordingly.

Professional Tax/Return Applicable States across India

Professional Tax is a state-level tax, and it is applicable in various states across India. The following is a list of states where Professional Tax is applicable:

Andhra Pradesh
Assam
Bihar
Chhattisgarh
Gujarat
Karnataka
Kerala
Madhya Pradesh
Maharashtra
Manipur
Meghalaya
Mizoram
Nagaland
Odisha
Punjab
Rajasthan
Tamil Nadu
Telangana
Tripura
Uttar Pradesh
West Bengal
The list of states where Professional Tax is applicable also applies to Professional Tax return filing. Taxpayers in these states must file their Professional Tax return within the specified time to avoid penalties and legal consequences.

Professional Tax slab rate

The Professional Tax slab rate varies from state to state in India. Each state has its slab and rate for Professional Tax based on the taxpayer's Income. Generally, the Professional Tax slab rate is divided into different categories, such as:

Monthly Income less than Rs. 15,000
Monthly Income between Rs. 15,001 to Rs. 25,000
Monthly Income above Rs. 25,000
It is important to note that Professional Tax is a state-level tax, and hence, the slab rate may vary from state to state. Taxpayers must comply with their respective states' applicable regulations while doing Professional tax return filing.

PTRC Return Filing: Employer’s Obligations

The responsibility of Professional tax return filing varies based on the type of taxpayer.
For salaried and wage earners, the employer deducts the Professional Tax from their salaries or wages and deposits it with the state government. Therefore, it is the employer's responsibility to file the Professional Tax Return.

In the case of self-employed individuals, they must pay the Professional Tax themselves, and it is their responsibility to file the Professional Tax Return. In some states, employers are also required to file a return for self-employed individuals under their employment.

Who Files Profession Tax Returns?

The responsibility of Professional tax return filing varies based on the type of taxpayer.
For salaried and wage earners, the employer deducts the Professional Tax from their salaries or wages and deposits it with the state government. Therefore, it is the employer's responsibility to file the Professional Tax Return.

In the case of self-employed individuals, they must pay the Professional Tax themselves, and it is their responsibility to file the Professional Tax Return. In some states, employers are also required to file a return for self-employed individuals under their employment.

PTRC Return Filing: Employer’s Obligations

As per the regulations, it is the responsibility of the business owner to deduct professional Tax from their employees' salaries and remit the collected amount to the relevant government department. Additionally, the employer must file a Professional Tax Return in the prescribed format within the stipulated time frame, providing proof of tax payment. Failure to enclose the payment proof with the return will render the filing incomplete and invalid, and the relevant authorities will take appropriate action.

Exemption for Filings Professional Tax

In addition to the general exemptions from paying Professional Tax, there are exemptions for certain individuals from filing Professional Tax Returns under the Professional Tax Rules.
The following individuals are exempted from filing Professional Tax Returns:

Individuals with professional tax liability below the prescribed limit.
Parents of children with mental or permanent disabilities.
Individuals with permanent physical disabilities (including blindness).
Members of the armed forces as defined in the Army Act of 1950, Air Force Act of 1950, and Navy Act of 1957,
including auxiliary or reservist members serving in the state. Badli workers in the textile industry.
Parents or guardians of individuals with mental disabilities.
Women exclusively engaged as agents under the Mahila Pradhan Kshetriya Bachat Yojana or Director of Small Savings. Individuals above 65 years of age.

Benefits of PT Return Filing

PTRC Return Filing (Professional Tax Registration Certificate) has several benefits for taxpayers and the government. Some of these benefits are:
Avoidance of Penalties and Legal Consequences:
Filing the Professional Tax Return on time and paying the tax liability on time can help taxpayers avoid penalties and legal consequences. We file your returns before the professional tax return due date.
Compliance with Applicable Laws:
Filing the Professional Tax Return helps ensure compliance with the applicable laws and regulations, which can prevent legal issues and consequences.
Improved Creditworthiness:
Filing the Professional Tax Return on time and maintaining a clean tax record can improve the taxpayer's creditworthiness and help them access credit facilities from banks and financial institutions.
Access Social Security Benefits:
Filing the Professional Tax Return can help individuals access social security benefits such as medical insurance, pension, and other government welfare schemes.
Easy and Convenient:
Filing the Professional Tax Return or PT annual return is a simple and convenient process, and with the advent of online filing, it has become even more accessible and easy.
Increased Revenue for the Government:
Filing for professional tax returns helps the government track the tax liability of individuals and entities and ensures that they pay the correct amount of Tax, which in turn helps increase the revenue for the government.

Documents required for Professional Tax Return filing

The documents required for PT Return filing may vary from state to state. However, some of the common documents that are required for filing professional tax returns are:

PAN Card
Aadhaar Card
Voter ID or Passport
Bank account details
Salary details or income proof
Registration Certificate or Shop and Establishment Certificate
Challans or payment receipts for Professional Tax payment
Details of the Tax deducted at source (TDS) from the salary

Procedure for Professional Tax Return Filing

The procedure for PTRC Return filing may vary slightly depending on the state regulations, but the general steps are as follows
1.Obtain the Professional Tax Registration Certificate:
Before filing the return, it is essential to have a Professional Tax Registration Certificate from the relevant state authority.
2.Determine the applicable slab and rate:
The rate and slab for Professional Tax may vary from state to state. It is important to determine the applicable slab and rate based on the Income earned and the profession.
3.Collect the necessary documents:
Collect all the necessary documents, such as salary/wage slips, proof of tax payment, and any other relevant documents required for the return.
4.Prepare the return:
Prepare the return in the prescribed format provided by the state authority.
5.Submit the return:
Submit the return along with the required documents to the designated office of the state authority.
6.Pay the Tax:
Pay the Professional Tax due, if any, along with the return.
7.Obtain acknowledgment:
Obtain acknowledgment of the return filing and tax payment made.

Penalties for failing to File Professional Tax Return

Penalties for failing to submit a Professional Tax (PT) return on time or withholding payments after the due date can vary based on each state's professional tax regulations.

Businesses that do not register for PT pay taxes late or miss the PT return due date can face penalties, late fees, or even imprisonment. In addition, there are penalties for late payment or failure to file a return by the due date.

For example, Maharashtra Government imposes a penalty or Rs. 5/- per day for not obtaining PT registration Rs. 1,000/- for late filing of Professional tax return

Interest at the rate of 1.25% per month and a penalty of 10% for late payment of PT dues.
To illustrate, if the professional Tax of Rs. 1 Lakh is delayed by 12 months, then the simple interest payable would be Rs. 1,250/-, and the penalty would be Rs. 10,000/-.
The total penalty in this case would be Rs. 11,250/-.
The maximum penalty for a delay in payment of Rs. 1 Lakh for a year, along with delayed return filing, is Rs. 12,250/-.