Professional Tax

Professional tax is a direct tax levied on persons earning an income by either practicing a profession, employment, calling, or trade. Unlike income tax imposed by the Central Government, professional tax is levied by the government of a state or union territory in India. In the case of salaried and wage earners, the professional tax is liable to be deducted by the Employer from the salary/wages, and the same is to be deposited to the state government. In the case of other classes of individuals, this tax is liable to be paid by the employee himself. The tax calculation and amount collected may vary from one State to another, but it has a maximum limit of Rs. 2500/- per year.


Benefits of Professional Tax Registration

The benefits of Professional tax Registration are given below:

  • It is simple to comply with Professional Tax Compliance, which results in a smooth registration process with minimum restrictions.
  • It is compulsory to pay Professional tax as per the law. Hence, the timely payment of Professional tax can help avoid penalties and any punitive action against the Employer or a self-employed person.
  • Professional Tax Compliance is simple, which can enable a smooth and hassle-free Registration Process.
  • The Professional Tax acts as a revenue source for the state governments that helps the government to implement schemes for the various welfare and development of the region.
  • The Employer or the self-employed person can claim a deduction on the previously paid professional tax.

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