- Even though GST is implemented, yet Maharashtra Profession Tax is not abolished. It is still applicable.
- Profession Tax is a tax which is levied by the state on the income earned by way of profession, trade calling or employment.
- Anyone earning an income from salary or anyone practicing a profession such as chartered accountant, company secretary, lawyer, doctor etc. are required to pay this profession tax.
- There are two types of Profession tax registration
1) Profession Tax Enrollment certificate (PTEC)
2) Profession Tax Registration Certificate (PTRC)
REGISTRATION AND ENROLMENT
Under Section 5 — every person, liable to pay tax u/s. 4, shall obtain a Certificate of Registration, and, every person, liable to pay tax u/s. 3(2), shall obtain a Certificate of Enrolment from prescribed authority in prescribed manner.
Application for enrolment/registration shall be made within 30 days from date of commencement of profession, trade, calling or employment or within 30 days of becoming liable to pay tax under the Act. (PTEC)
Obtaining a registration is mandatory within 30 days of employing first staff in the business. (PTRC)
RESPONSIBILITY OF DEDUCTION:
The owner of a business is responsible to deduct profession tax from the salaries of his employees and pay the amount so collected to the appropriate government department. He/she has to furnish a return to the tax department in the prescribed form within the specified time.
AMOUNT OF TAX:
Maximum amount of tax in the both the cases is of Rs.2500/-.
However in Profession tax (PTRC) is required to be deducted from the salary or wages paid. Since it is imposed at the state level, different states have different rates, collection method and hence, the tax amount varies but it is capped at Rs.2500 per annum.
SPECIAL BENEFIT OF PAYMENT FOR PTEC:
Enrolled person/s can avail the benefit of scheme, as provided u/s. 8(3) of the Act. Accordingly one can discharge his liability for five years by making advance payment, of an amount equal to four times of annual tax liability.
SLAB FOR PTRC PAYABLE BY THE EMPLOYER:
|SALARIES OR WAGES PAID TO EMPLOYEES (MONTHLY)||AMOUNT|
|Does not exceed Rs. 7,500||NIL|
|Female – Exceeds Rs. 7,500 but does not exceed Rs.10,000||NIL|
|Male – Exceeds Rs. 7,500 but does not exceed Rs.10,000||Rs. 175 per month|
|Female and Male –Exceeds Rs.10,000||Rs. 200 per month*|
Rs.300 in the month of February.
PTRC PAYMENT AND FILING OF RETURNS:
|Annual Tax Liability During the Preceding Year||Periodicity||Due Date for Payment & E-Return Filing|
|Annual Tax Liability less than Rs. 50,000||Annually*||31st March of the respective F.Y.|
|Annual Tax Liability equal to or above Rs. 50,000||Monthly||Last day of the respective month.|
*Periodicity is monthly in the first year of registration.
INTEREST AND PENALTY FOR NON-PAYMENT OF TAX
If an enrolled person/registered employer fails to pay the tax in time he shall be liable to pay simple interest @ 1.25% of the tax payable for each month for which the tax remains unpaid.
Further if the enrolled person/registered employer fails without reasonable cause, to make payment of any tax within the required time the prescribed authority may, after a reasonable opportunity of hearing, impose a penalty equal to 10% of the tax due.
Name: CA Monika N. Rathi
-The author is Chartered Accountant and she working as a partner in the M/s SSRPN. & Co.