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Professional Tax in Karnataka

Professional tax is levied by the Karnataka state government which needs to be paid by an employed person and the professional.

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Professional Tax in Karnataka- An Overview

Profession Tax is levied by the state government which is applicable to salaried employees and individuals. Employees working in an organisation or establishment such as a factory would also have to go for the registration process of professional tax in Karnataka.

Registration of Professional tax in Karnataka is mandatory for the business within 30 days of employing staff and for professionals within 30 days of starting their practice. The professional tax has to be deducted from the salary/wages paid. However, the amount of professional tax varies from state to state which is capped at Rs. 2500 per annum. If you have employees in more than one state then in each state professional tax registration is required to be obtained.

Who Regulates Professional Tax in Karnataka?

In Karnataka professional tax is governed by the Karnataka Tax on Professions, Trades, Callings and Employments Act, 1976. If the employee and professional have a monthly income of more than the limit prescribed then they have to pay professional tax in Karnataka India. Professional tax payment can also be made online.

Eligibility Criteria for Registration of Professional Tax in Karnataka?

If the salary of the wages of the employee earned is more than Rs. 10,000/- per month then the employer has to mandatorily go for the process of professional tax registration in Karnataka.

The employer in such circumstances would be liable to deduct some amount of wages under this act.

Before expiry of 20 days of the month, the employer is liable to deduct the professional tax.

If the threshold or the amount of professional tax payable in Karnataka is lesser than Rs. 5000/- per month then the employer can opt for the payment  of professional tax  within 20 days of the expiry of the quarter of the year.

All employees have to obtain a professional tax registration certificate from the concerned officer.

All individuals or professionals are liable to register for professional tax. Individuals who are enumerated in Sl. No.2 to 74 of the Schedule (Annexure 1) shall obtain a Certificate of Enrollment from the Profession Tax Officer.

Who has to pay Professional Tax in Karnataka?

The following has to pay Professional Tax:

Who has to pay Professional Tax in India

Note: For the purpose of tax liability, every branch will be treated as a separate firm.

Professional Tax in Karnataka - Exemptions

For the following below mentioned individuals, professional tax in Karnataka would not be payable:

  • Senior Citizens are exempt from paying professional tax.
  • All charitable and philanthropic hospitals or nursing homes situated in all the districts in places below the taluk level except Bangalore and Bangalore Rural District.
  • If you are a director of a company registered in Karnataka and simultaneously nominated by the financing agencies which are owned or controlled by the State Government or by other statutory bodies.
  • Such foreign technicians who are employed in the State and their appointment is approved by the Government of India for the purpose of tax exemption for the defined period (exemption for a period of 2 years from the joining date).
  • Professional tax in Karnataka is also exempt for the members of the Armed Forces who are governed by the Army Act, the Navy Act, and the Air Force Act.
  • Blind persons earning salaries and wages.
  • Deaf and dumb persons, earning salaries and wages.
  • Single taxi or single three-wheeler goods vehicle permit holders.
  • Institutions which are involved in teaching Kannada or English Shorthand or Typewriting.
  • A Physically handicapped person who must not have less than 40% of permanent disability (subject to production of a certificate from the HOD of Government Civil Hospital).
  • If you have a single child and has undergone sterilization operation, however, production of a certificate from the District Surgeon, Government Civil Hospital is mandatory.
  • Central Para-Military Force (CPMF) Personnel.
  • If an educational institution is carried by you in respect of their branches teaching classes up to 12th standard or pre-University Education.

What will be the effect of Non-Registration of Professional Tax/ Non-Filing of return/ Non-Payment of Tax in Karnataka?

What will be the effect of Non Registration of Professional Tax Non Filing of return Non Payment of Tax in Karnataka

Employer Registration

In case of non-registration for professional tax in Karnataka by an employer, the penalty would be Rs 1000. In case of any other person Rs. 500/-.

Employee Registration

In case of non-registration for professional tax by an employee the penalty would be from the date of employment till the registration is obtained with simple interest at 1.25% for each month besides this there will be a penalty equal to the tax to be paid till the date of payment.

Non Filing of Return

In case of non-filing of the professional tax return, the penalty is Rs. 250/- for an employer.

Non Payment of Tax

In case of the non-payment of tax by the enrolled person and registered employer, interest at the rate of 1.25% per month and the penalty will not exceed the 50% of the tax amount due.

What is the process of Professional Tax Registration in Karnataka?

The following process has to be utilised for professional tax registration in Karnataka:


What is the process of Professional Tax Registration in Karnataka
  • Enrollment in the E-Prerna Portal- First and foremost the applicant would have to go online to the following website (https://pt.kar.nic.in/(S(t5zcqklwvzs1h42orkxvrtdv))/Main.aspx) . On the left side bar of the application, the applicant would have to click on Enrollment of Application. If the applicant is enrolling for payment of professional tax for the first time then the enrolment of professional tax must be considered. If the applicant is new, then click and select the new category for enrolment.
  • Select the Business Applicable to the Enrollment- In the next step, the applicant has to select the suitable business for enrolment for the professional tax. Here information related to the application must be provided by the employer. With this, the applicant has to enter the financial year for which professional tax has to be paid. If the applicant is already enrolled for the payment of professional tax in Karnataka then the following ‘Enrolled’ must be selected by the applicant. Then the applicant has to input the 9 digit alphanumerical enrolment certificate for professional tax in Karnataka. When choosing the business type and status, personal information related to the business must be mentioned. If the business has multiple branches to carry out activities, then the same must be mentioned in the drop down menu of the form.

 

  • Click on Relevant Tax Applicable on the Schedule- In the next step, the employer has to click on the relevant tax which is applicable on the respective business. For this the professional tax schedule of Karnataka must be considered.
  • Payment- In the last step the applicant must select the mode of payment of professional tax. The applicant can either pay online or offline. There is a method for e-payment option for the applicant. If this is not possible then applicant can either pay through cash, cheque or DD. After this the applicant would be provided with a PTN No or a Professional Tax Number. After this the applicant has to enter the professional tax number along with the professional tax data. Then the procedure for registration of professional tax is complete.

Employer Registration for Professional Tax in Karnataka

  • First and foremost every employer has to secure the professional tax certificate for payment of professional tax in Karnataka,
  • The employer would have to go to the e-Prerna website https://pt.kar.nic.in/(S(t5zcqklwvzs1h42orkxvrtdv))/Main.aspx for professional tax registration in Karnataka. After this the employer would have to go to the new registration section for professional tax in Karnataka.
  • All the information related to the business must be filed by the employer – which would include the constitution of the company , type of business of the company and the PAN details of the company.
  • Once this is complete, the office of the professional tax department would issue a PIN in the name of the company.
  • After this the employer would have to enter the information in the enrolment certificate.
  • If the applicant is registered under the Karnataka GST then the 15 digit number must be entered into the system.
  • After this the status of Professional tax can be checked online by adding details of the Aadhaar and the registered mobile number.
  • The status of the company application can be checked through the drop down menu as stated the status.

What are the documents required for Professional Tax registration in Karnataka?

Following documents are required for Professional Tax registration in Karnataka:

  • Passport size photograph of Proprietor, Partner in case of partnership firm or Directors in case of a company as per the applicability
  • Address proof of Proprietor, Partner in case of partnership firm or Directors in case of a company as per the applicability
  • Address Proof of establishment
  • PAN (Permanent Account Number)
  • Employee salary details

In case Professional Tax registration was not obtained in the first year then financial statements are also required to be submitted. If it not the first year or you have not obtained the PT registration at the start of business or profession you need to also provide financial statements.

How much Professional Tax is paid by the Employer and how much Professional Tax is required be paid by the employer on the behalf of employees?

Professional tax is required to be paid by every employer every year before 30th April. Professional tax is also required to be deducted from the salary of employees and remit to the respective government. The details of professional tax payable by the employer are listed under the schedule of Professional Tax Act.

Professional Tax Payable by the employer is defined below:

Description

Amount Payable

In case of no employees

Nil

In case of a maximum of 5 employees

Rs. 1000/- Per Annum

In case of more than 5 but not more than 10 employees

Rs. 1500/- Per Annum

In case of more than 10 employees

Rs. 2500/- Per Annum

All the dealers who are registered or liable to be registered under the Karnataka Sales Tax Act, 1957 / The Karnataka Value Added Tax Act, 2003 having following a turnover in any year:

Description

Amount Payable

Not more than Rs. 2 lakhs

Nil

More than Rs. 2 lakhs but less than Rs. 10 lakhs

Rs. 1000/-

More than Rs. 10 lakhs but less than Rs. 25 lakhs

Rs. 1500/-

More than RS. 25 lakhs

Rs. 2500/-

When the salary of the employee is more than Rs. 15000 or more, Professional Tax (PT) shall be deducted maximum Rs. 200 per month.

How we can file Professional Tax Return?

Once you will get registered with the Professional Tax registration department, Id Password will be issued in order to file a professional tax return. By using such Id password you can file a professional tax return on the website of the Karnataka government. For professional tax return filing you need to login to your account and on the basis of requirements such as monthly filing or quarterly filing, payment should be made.

How we will help you in Professional Tax Registration?

  • Collection of all the necessary documents

In the first step, our experts will collect the necessary documents for your Professional Tax registration in Karnataka.

  • Preparation for Professional Tax Registration

On the basis of the given documents and information, our experts will apply for Professional tax registration with the Karnataka government.
Now, to complete this process, you have to fill an inquiry form on our website and click on Get Started button. Our expert will call you back and solve your query. After the initial payment, our system will generate your order no which will be allocated to a dedicated in-house CA.

How to reach Enterslice for Professional Tax in Karnataka

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Frequently Asked Questions

The minimum salary applicable for professional tax payment in Karnataka is Rs 10,000.

Yes professional tax payment can be made online.

Yes the offline mode or the online mode can be utilised for professional tax registration in India.

Yes a unique enrolment number would be provided to the applicant for professional tax payment.

No professional tax payment is completely an online process, the applicant would not require to be present for professional tax registration in Karnataka.

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