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Professional Tax Registration

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Overview

Professional tax is a tax that is imposed by the State government on all salaried individuals. Professional tax is applicable to all working professionals like chartered accountants, lawyers, and doctors. It is levied based on the individual’s employment, trade or profession. The tax rates differ across all states, however, the maximum amount that can be levied as Professional tax is Rs.2,500 per annum.

Applicability

Professional tax is levied on all types of trades and professions in India. It has to be paid compulsorily by every staff member who is employed in any private firm operating in India. Professional tax registration is the onus of every business owner, who must take up responsibility for deduction of professional tax and payment for the same

Professional Tax Variation With Each State

Professional tax fee will also have different rates that tend to differ from state to state. The state governments which are levying state tax are West Bengal, Maharashtra, Karnataka, Kerala, Assam, Madhya Pradesh, Orissa, Tripura, Meghalaya, and Gujarat.

Professional Tax For Self-Employed

Any professional who obtains a monthly regular income will need to pay the professional tax. By the word professional, we mean people employed in specialized fields such as accountancy, media, etc.

They can fill the form and get a registration number first. Then, using that number, they can pay their taxes in the corresponding banks.

Exemption from registration

The Professional Tax Rules provide exemptions to the following individuals

  • Parents of children suffering from mental or permanent disability.
  • Members of the armed forces ( as designated in the Air Force Act, Navy Act and Army Act ) including members of auxiliary forces/reservists, serving in a particular state.
  • Individuals with permanent physical disability ( inclusive of blindness)
  • Individuals over the age of 65.
  • Badli workers engaged in the textile industry
  • Women engaged exclusively as an agent under the Directorate of Small Savings or Mahila Pradhan Kshetriya Bachat Yojana.
  • Guardians or parents of mentally challenged individual

Comparison Study Between Enrollment and Registration

Traders and self-employed professionals must apply for Professional Tax Registration Certificate (PTRC) and Professional Tax Enrollment Certificate (PTEC) in their respective states.

Registration Certificate is required by entities who employ individuals and pay them wages/salary. On the other hand, PTEC is required by traders and self-employed to pay the company’s and director’s professional tax.

Hence, to conclude professional tax registration is also necessary for people who are employed. Whereas enrollment is necessary for those who own a trade, business or is involved in a profession.

Average Half-Yearly Income Half yearly Profession Tax (in Rs)
Upto 21,000
NIL
21,001 to 30,000
135/-
30,001 to 45,000
315/-
45,001 to 60,000
690/-
60,001 to 75,000
1,025/-
75,001 and above
1,250/-

Registration process in Tamil Nadu (10 Step process)

  1. Every person may apply for registration of profession tax by visiting the online portal available in website www.chennaicorporation.gov.in
  2. After registering the details of mobile number, e-mail id etc., the applicant shall get his/her unique user name and password through his mobile and e-mail in a secured manner,
  3. Through Citizen portal, the applicant will create the self-assessment application and submit the application for profession tax.
  4. Following documents are to be uploaded along with the application:
  • Certificate received from the Registrar of Companies
  • Memorandum of Articles (In case of Limited Company)
  • Proof for Office at Chennai (Mandatory)
  • Certificate from Commercial Tax Department
  • Pan Card / Bank A/c. Details
  • Employer & Employee details (Mandatory)

 

  1. There is no fee to be paid at the time of submission of application.
  2. Once Citizen submits the application, an acknowledgement slip for filing of return will be

generated with the profession tax Registration Number (Profession Tax New Account number-PTNAN).

  1. After that, the Assessee shall pay the tax online by using any mode of payment,
  2. If Assessee has paid the profession tax, he can download the copy of the profession tax assessment order from COC website,
  3. Once the assessment order is generated, the details of the assessment shall be moved to the inbox of respective ARO of the Zone for verification of assessment of profession tax made by the applicant,
  4. After verification, the A.R.O, will revise the profession tax demand if it is under assessed or A.R.O will confirm the assessment of profession tax, if the same is found to be correct.
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