Professional Tax in Karnataka, Maharashtra & Telangana in 2020

Last Updated at: January 06, 2020
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Professional tax 2020 in Karnataka, Maharashtra & Telangana

Several states in India collect a particular tax known as Professional tax. The tax is levied and collected by the respective State Governments directly and is imposed on salaried individuals. The various States in India have different ways and sabs when it comes to this tax, and hence, it can get quite confusing at times. Majority of the states imposes the Professional Tax via various collection methods. Everyone from small business owners to doctors are liable to pay this tax. Hence, in this article, we will be taking a look at everything you need to know regarding the Professional Tax in Karnataka, Maharashtra, and Telangana.

What is Professional Tax?

Let us start with the basics. So, what exactly is the Professional tax? Essentially, it is a form of tax on income through a profession or trade by various state governments. The power to levy such a tax has been given to various State Governments via Clause 2 of the Constitution’s Article 276. As most Municipal Corporations in a majority of states impose this tax, it constitutes a significant revenue source for the government. Here’s a look at a few things to keep in mind regarding this tax.

Points to keep in Mind

  1. The maximum amount payable is INR 2,500 annually.
  2. Even employees of private companies are liable to pay this tax.
  3. Predetermined slabs help in gauging how much tax a salaried individual must pay.
  4. The decided amount is then debited from the employee’s account every month and credited to the Municipal Corporation.
  5. While the payment if this tax is a mandatory obligation, taxpayers can avail tax deductions for such payments.

E-file your tax

Professional tax in Telangana

The Professional tax in Telangana works as per the Employment Act 1987 and consist of the following slab rates for each month:

  • Up to INR 15000, no Professional Tax is levied
  • Between INR 15001 and INR 20000 INR 150/month
  • Above INR 20000  INR 200/month

Professional tax in Karnataka

The Professional Tax slab for wage earners for each month is as follows:

  • Up to INR 15000 Nil
  • Above INR 15000 INR 200/month

Due Date and Penalty

In case any wage earner fails to pay the required tax on time, late payment fee at an interest rate of 1.25% will be levied on the amount to be paid. If deemed necessary, a maximum fine at a rate of 50% of the total due amount may be advocated by the respective authority. The due date for the payment of this tax without incurring any late fees is the 20th of every month. The employees may pay their Professional Tax via the States online professional tax e-payment portal.

Furthermore, salaried employees will have their PT deducted from their monthly salary, and this amount will be paid to the government via the portal by the company. Self-employed individuals may make use of the e-payment portal to settle all their dues and pay their PT.

Eligibility to Pay Professional Tax

The following individuals and professionals need to pay PT as per Karnataka laws:

  1. Companies and Corporations
  2. Corporate bodies
  3. Hindu Undivided Family
  4. Firms, Clubs, Societies and Associations
  5. Salaried Individuals
  6. Wage Earners
  7. Self-employed professionals

Exemptions

Exemption for the following individuals and institutions from paying PT as per Karnataka laws:

  • Charitable hospitals and nursing homes
  • Blind/Deaf/dumb and physically handicapped individuals earning a wage
  • Ex-servicemen 
  • Foreign technicians who the Central Government has approved 
  • Companies nominated by State-controlled financing agencies 
  • Members of the Armed forces and CPMF 

Professional Tax in Maharashtra

The Tax rates in Maharashtra are as follows:

  • Below INR 7500 Nil
  • Between INR 7501 and INR10000 INR175/month
  • Above INR10001 INR300 for February and INR200 for rest of the months

Women earning below Rs. 10,000 a month need not pay Professional Tax in Maharashtra. The last date for payment of all dues depends on who is paying the tax in Maharashtra. For companies whose liability exceeds INR 50,000, the last date is the 31st of March. The payment takes place annually, while for companies with lesser liability have to clear their dues monthly before each new month begins.

Payment of Professional Tax 

  1. Payment is to be made online via the tax portal at https://mahagst.gov.in/en/payments
    professional tax
  2. Documents such as TIN, TAN and PAN need to clear PT dues.
  3. Once you get to the site, fill in the required details and captcha, and then click on Next
  4. Select the correct PTRC form from the list provided and enter the necessary details

 

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Professional Tax in Karnataka, Maharashtra & Telangana in 2020

4144

Several states in India collect a particular tax known as Professional tax. The tax is levied and collected by the respective State Governments directly and is imposed on salaried individuals. The various States in India have different ways and sabs when it comes to this tax, and hence, it can get quite confusing at times. Majority of the states imposes the Professional Tax via various collection methods. Everyone from small business owners to doctors are liable to pay this tax. Hence, in this article, we will be taking a look at everything you need to know regarding the Professional Tax in Karnataka, Maharashtra, and Telangana.

What is Professional Tax?

Let us start with the basics. So, what exactly is the Professional tax? Essentially, it is a form of tax on income through a profession or trade by various state governments. The power to levy such a tax has been given to various State Governments via Clause 2 of the Constitution’s Article 276. As most Municipal Corporations in a majority of states impose this tax, it constitutes a significant revenue source for the government. Here’s a look at a few things to keep in mind regarding this tax.

Points to keep in Mind

  1. The maximum amount payable is INR 2,500 annually.
  2. Even employees of private companies are liable to pay this tax.
  3. Predetermined slabs help in gauging how much tax a salaried individual must pay.
  4. The decided amount is then debited from the employee’s account every month and credited to the Municipal Corporation.
  5. While the payment if this tax is a mandatory obligation, taxpayers can avail tax deductions for such payments.

E-file your tax

Professional tax in Telangana

The Professional tax in Telangana works as per the Employment Act 1987 and consist of the following slab rates for each month:

  • Up to INR 15000, no Professional Tax is levied
  • Between INR 15001 and INR 20000 INR 150/month
  • Above INR 20000  INR 200/month

Professional tax in Karnataka

The Professional Tax slab for wage earners for each month is as follows:

  • Up to INR 15000 Nil
  • Above INR 15000 INR 200/month

Due Date and Penalty

In case any wage earner fails to pay the required tax on time, late payment fee at an interest rate of 1.25% will be levied on the amount to be paid. If deemed necessary, a maximum fine at a rate of 50% of the total due amount may be advocated by the respective authority. The due date for the payment of this tax without incurring any late fees is the 20th of every month. The employees may pay their Professional Tax via the States online professional tax e-payment portal.

Furthermore, salaried employees will have their PT deducted from their monthly salary, and this amount will be paid to the government via the portal by the company. Self-employed individuals may make use of the e-payment portal to settle all their dues and pay their PT.

Eligibility to Pay Professional Tax

The following individuals and professionals need to pay PT as per Karnataka laws:

  1. Companies and Corporations
  2. Corporate bodies
  3. Hindu Undivided Family
  4. Firms, Clubs, Societies and Associations
  5. Salaried Individuals
  6. Wage Earners
  7. Self-employed professionals

Exemptions

Exemption for the following individuals and institutions from paying PT as per Karnataka laws:

  • Charitable hospitals and nursing homes
  • Blind/Deaf/dumb and physically handicapped individuals earning a wage
  • Ex-servicemen 
  • Foreign technicians who the Central Government has approved 
  • Companies nominated by State-controlled financing agencies 
  • Members of the Armed forces and CPMF 

Professional Tax in Maharashtra

The Tax rates in Maharashtra are as follows:

  • Below INR 7500 Nil
  • Between INR 7501 and INR10000 INR175/month
  • Above INR10001 INR300 for February and INR200 for rest of the months

Women earning below Rs. 10,000 a month need not pay Professional Tax in Maharashtra. The last date for payment of all dues depends on who is paying the tax in Maharashtra. For companies whose liability exceeds INR 50,000, the last date is the 31st of March. The payment takes place annually, while for companies with lesser liability have to clear their dues monthly before each new month begins.

Payment of Professional Tax 

  1. Payment is to be made online via the tax portal at https://mahagst.gov.in/en/payments
    professional tax
  2. Documents such as TIN, TAN and PAN need to clear PT dues.
  3. Once you get to the site, fill in the required details and captcha, and then click on Next
  4. Select the correct PTRC form from the list provided and enter the necessary details

 

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