Professional Tax: The Criteria and Applicability in West Bengal

Last Updated at: March 11, 2020
348
What is Professional tax
  1. What is a Professional Tax?

  2. Who has to pay the Professional Taxes?

  3. How are the professional taxes paid?

  4. What is West Bengal Professional Tax?

  5. What is the tax rate slab in West Bengal for salaried individuals?

  6. What is the tax rate slab in West Bengal for professionals?

  7. How the e-payment of professional tax is done in West Bengal?

Income tax is a very common word that can be heard in the news or can even be seen in the newspapers every other day. It is the tax levied by the central government on the salaried individuals, or to be even more specific, all the people employed individuals in the country.

But, ‘Professional Tax’ is a word which is quite unheard of. But, what exactly is professional tax, its criteria and who is supposed to pay this?

Professional tax (PT): An overview

Professional tax, in simple terms, is the tax levied by the state government on all the types of employment, trades as well as professions, these even include self-employed professionals. The professional tax is included under the Income Tax Act, 1961, under which the tax is deducted directly from the taxable income of the employed individual. Whereas for the self-employed and people having their business, they need to register themselves with the state legislative.

The power to levy the professional tax is within the hands of the states, and not all states in the country levy professional taxes. The details regarding the professional tax include:

  • The rates of tax vary depending on the income of the individual.
  • The maximum amount of the tax that can be levied is Rs.2,500.
  • A total of 15 states in India levy this tax.
  • The rights to collect these taxes are provided to the state government under Clause (2) of Article 276.
  • Under Article 246, the exclusive and final powers to make any changes in the tax slab rates are in the hands of the parliament.

Who has to pay the professional taxes?

The following people are liable to pay the professional taxes in West Bengal:

  • Individual
  • HUF (Hindu Undivided Family)
  • A company, body of individuals, a firm, cooperative society and others.
  • Legal & Medical practitioners
  • Architects
  • Engineers
  • Chartered Accountants
  • Tax & Management Consultants
  • Licensed shopkeepers
  • Occupier for factories
  • Licensed shipping brokers & boat suppliers

Get Professional Tax Registration

How are the professional taxes paid?

In the case of the employees and salaried people, these professional taxes are collected and paid to the state government by the employers, or the owners of the company. A certificate of registration has to be taken by the employer to submit the tax. In the case of self-employed professionals, the individuals themselves are responsible for paying the taxes to the government.

The organization that is finally responsible for the collection of these taxes is the Commercial Taxes Department of the state, the tax slab rates of which vary accordingly.

West Bengal Professional Tax (PT)

The West Bengal Tax on Profession, Trade, Callings, and Employment Act, 1979 manages the professional tax payments in West Bengal.

The payment procedure for PT in West Bengal is as follows:

  • For the salaried employees, the tax is paid by the employers.
  • For the self-employed individuals, they have to pay the tax themselves at the PT (Professional Tax) offices.

Tax slab rate in West Bengal for salaried individuals

Salary

Professional Tax Amount/ Slab Rate

Less than 10,000 Nil
Rs.10,000 – Rs.15,000 Rs.110
Rs.15,001 – Rs.25,000 Rs.130
Rs.25,001 – Rs.40,000 Rs.150
Rs.40,001 or more Rs.200

Tax slab rate in West Bengal for people engaged in a profession

Income

Professional Tax Amount/Slab Rate

Less than Rs.60,000 Nil
Rs.60,000 – Rs.72,000 Rs.480/annum
Rs.72,000 – Rs.84,000 Rs.540/annum
Rs.84,000 – Rs.96,000 Rs.600/annum
Rs.96,000 – Rs.1,08,000 Rs.1,080/annum
Rs.1,08,000 – Rs.1,80,000 Rs.1,320/annum
Rs.1,80,000 – Rs.3,00,000 Rs.1,560/annum
Rs.3,00,000 – Rs.5,00,000 Rs.2,000/annum
Rs.5,00,000 or more Rs.2,500/annum

*For the individuals who are involved in professions or trade have to pay a professional tax of Rs.2,500/annum, irrespective of the limits of the income or the turnover.

E-payment of Prof. tax in West Bengal

Apart from the offline mode of the payment of taxes by visiting the PT office, the payment can be done online at the portal wbcomtax.co.in. Under the e-services section, click on the e-payment option available. Under this, further, an option of ‘GRIPS’ is available through which the payment can be made easily and quickly.

Penalty for late payments

The individual or the company may have to pay a penalty due to the following reasons:

  • Delay in the payment of the PT.
  • Failure of enrollment for the PT within 90 days from the date of eligibility.

The penalty charges for the late payments are at the rate of 1% of the total tax for every month.

This can again vary from state to state.

Conclusion

As such, to run a business successfully or to work in a secured job, it is essential to pay all the taxes including the professional tax and income tax. The criteria of registration and payment are different across various states and therefore, must be looked after carefully, else the individual or company is liable to strict actions and penalties.

 

0

Professional Tax: The Criteria and Applicability in West Bengal

348
  1. What is a Professional Tax?

  2. Who has to pay the Professional Taxes?

  3. How are the professional taxes paid?

  4. What is West Bengal Professional Tax?

  5. What is the tax rate slab in West Bengal for salaried individuals?

  6. What is the tax rate slab in West Bengal for professionals?

  7. How the e-payment of professional tax is done in West Bengal?

Income tax is a very common word that can be heard in the news or can even be seen in the newspapers every other day. It is the tax levied by the central government on the salaried individuals, or to be even more specific, all the people employed individuals in the country.

But, ‘Professional Tax’ is a word which is quite unheard of. But, what exactly is professional tax, its criteria and who is supposed to pay this?

Professional tax (PT): An overview

Professional tax, in simple terms, is the tax levied by the state government on all the types of employment, trades as well as professions, these even include self-employed professionals. The professional tax is included under the Income Tax Act, 1961, under which the tax is deducted directly from the taxable income of the employed individual. Whereas for the self-employed and people having their business, they need to register themselves with the state legislative.

The power to levy the professional tax is within the hands of the states, and not all states in the country levy professional taxes. The details regarding the professional tax include:

  • The rates of tax vary depending on the income of the individual.
  • The maximum amount of the tax that can be levied is Rs.2,500.
  • A total of 15 states in India levy this tax.
  • The rights to collect these taxes are provided to the state government under Clause (2) of Article 276.
  • Under Article 246, the exclusive and final powers to make any changes in the tax slab rates are in the hands of the parliament.

Who has to pay the professional taxes?

The following people are liable to pay the professional taxes in West Bengal:

  • Individual
  • HUF (Hindu Undivided Family)
  • A company, body of individuals, a firm, cooperative society and others.
  • Legal & Medical practitioners
  • Architects
  • Engineers
  • Chartered Accountants
  • Tax & Management Consultants
  • Licensed shopkeepers
  • Occupier for factories
  • Licensed shipping brokers & boat suppliers

Get Professional Tax Registration

How are the professional taxes paid?

In the case of the employees and salaried people, these professional taxes are collected and paid to the state government by the employers, or the owners of the company. A certificate of registration has to be taken by the employer to submit the tax. In the case of self-employed professionals, the individuals themselves are responsible for paying the taxes to the government.

The organization that is finally responsible for the collection of these taxes is the Commercial Taxes Department of the state, the tax slab rates of which vary accordingly.

West Bengal Professional Tax (PT)

The West Bengal Tax on Profession, Trade, Callings, and Employment Act, 1979 manages the professional tax payments in West Bengal.

The payment procedure for PT in West Bengal is as follows:

  • For the salaried employees, the tax is paid by the employers.
  • For the self-employed individuals, they have to pay the tax themselves at the PT (Professional Tax) offices.

Tax slab rate in West Bengal for salaried individuals

Salary

Professional Tax Amount/ Slab Rate

Less than 10,000 Nil
Rs.10,000 – Rs.15,000 Rs.110
Rs.15,001 – Rs.25,000 Rs.130
Rs.25,001 – Rs.40,000 Rs.150
Rs.40,001 or more Rs.200

Tax slab rate in West Bengal for people engaged in a profession

Income

Professional Tax Amount/Slab Rate

Less than Rs.60,000 Nil
Rs.60,000 – Rs.72,000 Rs.480/annum
Rs.72,000 – Rs.84,000 Rs.540/annum
Rs.84,000 – Rs.96,000 Rs.600/annum
Rs.96,000 – Rs.1,08,000 Rs.1,080/annum
Rs.1,08,000 – Rs.1,80,000 Rs.1,320/annum
Rs.1,80,000 – Rs.3,00,000 Rs.1,560/annum
Rs.3,00,000 – Rs.5,00,000 Rs.2,000/annum
Rs.5,00,000 or more Rs.2,500/annum

*For the individuals who are involved in professions or trade have to pay a professional tax of Rs.2,500/annum, irrespective of the limits of the income or the turnover.

E-payment of Prof. tax in West Bengal

Apart from the offline mode of the payment of taxes by visiting the PT office, the payment can be done online at the portal wbcomtax.co.in. Under the e-services section, click on the e-payment option available. Under this, further, an option of ‘GRIPS’ is available through which the payment can be made easily and quickly.

Penalty for late payments

The individual or the company may have to pay a penalty due to the following reasons:

  • Delay in the payment of the PT.
  • Failure of enrollment for the PT within 90 days from the date of eligibility.

The penalty charges for the late payments are at the rate of 1% of the total tax for every month.

This can again vary from state to state.

Conclusion

As such, to run a business successfully or to work in a secured job, it is essential to pay all the taxes including the professional tax and income tax. The criteria of registration and payment are different across various states and therefore, must be looked after carefully, else the individual or company is liable to strict actions and penalties.

 

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A lawyer with 14 years' experience, Vikram has worked with several well-known corporate law firms before joining Vakilsearch.