Professional Tax Registration

What is Professional Tax?

Professional Tax is a state-imposed tax in India, applicable to salaried individuals and professionals. It is deducted monthly from salaries and serves as a state revenue source.

  • Simplified Enrollment : The process of enrolling for professional tax is now simplified, affordable, and easily accessible through PSD Filings.
  • State-Regulated Tax : Professional tax in India is a state-regulated tax imposed on all salaried individuals. Certain states, including Delhi, UP, and Haryana, are exempted from this tax.
  • Applicability to Various Professionals : The tax is applicable to various professionals such as chartered accountants, doctors, and lawyers. It is dependent on an individual's employment, business, or profession.
  • Obligation for Business Owners and Freelancers : Business owners, freelancers, and others are obligated to pay professional tax once their earnings surpass the pecuniary threshold.
  • Varied Tax Rates : Tax rates vary among states, with the maximum professional income tax set at Rs. 2,500 per year.

GET STARTED

Who should pay Professional Tax in India?

  • Self-Employed Professionals :
    Self-employed professionals must register for Professional Tax, fulfilling their legal obligation to pay this tax to the state government, encompassing various professions, businesses, and trades .
  • Self-Employed Individuals :
    Self-employed individuals must obtain a Certificate of Enrolment in the prescribed format from the authorized authority, making it a mandatory requirement.
  • Salaried Individuals :
    For salaried individuals, monthly Professional Tax is deducted. Employers must obtain a registration certificate from the respective authority before depositing the deducted amount.
  • Annual Income-Tax slabs :
    The Commercial Taxes Department collects Professional Tax based on varying state slabs, calculated from professionals' annual income. Payment options include annual or monthly contributions.
  • Procedure for Professional Tax Registration

    Visit your state's Commercial Taxes Department portal, complete the online form, upload documents, pay the registration fee, verify details, and await verification. Download the approved certificate for display.

    Apply Online

    You can apply for Professional Tax registration certificates conveniently online through the official CTD portal, thereby streamlining the application process for increased efficiency and accessibility.

    Submit Documents

    To complete the professional tax registration application, the applicant needs to submit the necessary scanned documents along with the filled in application form.

    Offline Mode

    Alternatively, individuals can opt for offline application submission by directly providing the application and documents to the concerned State Government, by paying the prescribed fee.

    Verification Process

    Upon submission, the Tax authority thoroughly scrutinizes the application during the Professional Tax Registration process to ensure accuracy and compliance with regulatory requirements.

    Approval Process

    After a thorough verification process, the Tax authority grants approval to the application, subsequently issuing the Professional Tax Registration Certificate to the successful applicant.

    Raise Query

    If the application has shortcomings, the Tax Department may raise queries. Timely response to these queries is crucial for successful processing within the specified timeframe.

    Applicability of Professional Tax

    Professional tax applies to individuals employed in a particular state, including salaried workers, professionals, and traders. It is mandatory for self-employed individuals engaged in professions, businesses, or trades, and the tax rates vary for each state. Employers deduct professional tax from the salary of employees, and the collected tax is remitted to the state government.

    Individual

    • An individual refers to a single person as a distinct legal entity, responsible for conducting personal or professional activities with full ownership and liability

    One Person Company/Private/Public

    • OPC is a business structure where a single individual is the sole owner, while Private and Public Companies involve multiple shareholders with distinct regulations of authority

    Co-operative Society

    • A Co-operative Society is an association of individuals who voluntarily join together to address common economic or social needs through a democratically controlled business structure.

    Body of Individuals/Association of Persons

    • A group of individuals, whether incorporated or not, coming together for a common purpose, such as conducting a business collectively.

    Concessions And Reimbursements

    • Registered MSMEs can avail themselves of various concessions and reimbursements, reducing the cost of establishing a business unit or obtaining necessary certifications.

    Government Certification And License Process

    • MSMEs registered under Udyog Aadhar receive preferential treatment in government certification and license processes, facilitating smoother navigation of regulatory requirements