Taxation

Bihar Professional Tax Registration: Here’s all you need to know

The Bihar state government collects Bihar professional tax from the individuals earning from salary or professions (such as Chartered Accountants, lawyers etc.) or engaged in business or trade, has to pay professional tax. To pay professional tax, one needs to register as per the rules laid down by the respective state governments.

In this article, we will specifically look into the registration process for professional tax.

What is Bihar professional tax?

In India, the professional tax is regulated by the respective state governments on persons employed in the government & non-government sectors or earning from the income from business or trade or in practice of profession such as Lawyer, Company Secretary, Chartered Accountants, etc.

The professional tax levied on such persons varies from state to state. The amount collected as professional tax from a salaried employee is considered as deduction under income Tax Act.

Professional tax collected by the Bihar State Government is governed by the Bihar Professional Tax Act , 2011^[1]. The commercial taxes department is responsible to collect the professional tax in Bihar. The maximum of Rs. 2500 & minimum of Rs. 1000 annually can be collected as professional tax.

State Govt. does not charge any application fee for the professional tax registration.

Benefits of Professional Tax Registration in Bihar

The benefits for professional tax registration:

• It helps in complying with the state laws.
• It safeguards the interests of employer & the employee or the person engaged in business / trade, or practicing any profession.
• The professional tax deducted are according to the slab rates set by the state government according to the applicable rules & Act.

What are the documents required for professional tax registration in Bihar?

The documents required for professional tax registration in Bihar are:

• Filled application form
• Applicant’s address proof (that includes copy of telephone, electricity bill or driving license or passport)
• Applicant’s Id proof (that includes copy of Voter Id card or Aadhar Card or driving license or passport)
• PAN Card copy or TAN card of the Partners or Proprietor or Karta of HUF or Employer
• Bank account details (that includes copy of passbook or bank account statement showing the bank name & bank account no.)
• 2 passport size photos

What is the tax slab rate for Bihar professional tax?

The professional tax slab rates in Bihar is decided as per the Professions, Trades, callings and Employments Act, 2011 are:

S. No.	Class of Taxpayer	Tax Amount Payable
1.	Salaried individuals Income up to Rs. 3 lakhs per annumIncome ranges between Rs. 3 lakhs & Rs. 5 lakhs per annumIncome ranges between Rs. 5 lakhs & Rs. 10 lakhs per annumIncome more than Rs. 10 lakhs per annum	Rs. 1000 per annumRs. 2000 per annum   Rs. 2000 per annum   Rs. 2500 per annum
2.	Dealers registered under Bihar VAT Act, 2005 or registered only under the Central Sales Tax Act, 1956: Turnover of sale or purchase is up to Rs. 10 lakhs annumTurnover of sale or purchase ranges between Rs. 10 lakhs& Rs. 20 lakhs per annumTurnover of sale or purchase ranges between Rs. 20 lakhs& Rs. 40 lakhs per annumTurnover of sale or purchase is more than Rs. 40 lakhs per annum	Nil     Rs. 1000 per annum     Rs. 2000 per annum     Rs. 2500 per annum
3.	Holds permit for transport under Motor Vehicles Act, 1988 that can be used to fire or reward, where any such person holds permit for: Any taxi passenger car or any such vehicleAny bus or truck	Rs. 1000 per annumRs. 1500 per annum
4.	Companies that are registered under the Companies Act, 1956 & are engaged in any profession or trade or calling	Rs. 2500 per annum

What is the process for professional tax registration in Bihar?

For the registration of Bihar professional tax, these steps are to be followed:

Step 1:Go the official website of the Commercial Tax Department of the Bihar Government.

Step 2: Under the e – service tab, click on e – registration.

Step 3: The next page will appear, then select the option professional tax.

Step 4: Then the applicant needs to fill all the details required and upload the related documents & then click on add button.

Step 5: Then click on submit.

Step 6: The Acknowledgement receipt will be generated & the applicant needs to save the receipt for future reference.

Once the registration is approved by the concerned authority, the applicant will be notified via an SMS or e – mail.

The registration process usually takes 15 days from the date of application & after the verification form is filled.

The Deputy Commissioner, the assistant Commissioner & the Commercial Tax Officer are designated as the authority to grant professional tax registration certificate.

How to track the professional tax registration in Bihar?

The application registration status can be checked by visiting the official website and then selecting the registration type. Then enter the application number on the acknowledgement receipt.

What is the penalty in case of professional tax in Bihar?

When a taxpayer fails to pay the professional tax within the specified time, then the assessing authority may impose a penalty of 2% of the tax amount for every month till the default continues.

Conclusion

The Bihar Professional tax is levied on the persons earning income from salary from the employer or engaged in trade / business or practice any profession. It is clear from the article above that the state governments sets the tax slab rate to levy the professional tax.

Read our article:West Bengal Professional Tax Registration: Here’s all you need to know