PROFESSIONAL TAX: FREQUENTLY ASKED QUESTIONS

 

 

 

Which is the date on which an employer becomes bound to pay Professional Tax?

 

The date on which an employer disburses salary or wages to one or more of his / her employees becomes the date on which that particular person becomes bound to pay Professional Tax to his / her respective state government.

 

 

 

Penalty for providing incorrect details during the registration of Professional Tax

 

If someone provides incorrect details during registration or enrolment of Professional Tax, then he/she becomes liable to pay three times the tax payable as per the Profession Tax Act, as a penalty.

 

 

 

Fine imposed for non-compliance on the payment of Professional Tax

 

If one gets delayed in obtaining Professional Tax Registration, a penalty of Rs. 5 per day will be imposed on that person. In case of non / late payment of tax, the penalty that will be imposed will be 10% of the amount of Professional Tax. In case one files late returns, a fine of Rs. 1000 per return will be imposed if the return is filed within 1 month of the due date. After that, a penalty of Rs. 2000 will be imposed.

 

 

 

Are there any advantages of paying Professional Tax in advance?

 

Anyone who holds a Professional Tax Enrolment Certificate can get rid of his liability of paying Professional Tax for the next five years by making a payment equal to four times the rate of Professional Tax within 30th June, in advance, thereby saving one year’s liability.

 

 

 

What are the rules pertaining to Professional Tax regarding foreign employees?

 

Foreign employees working in any company in India are not bound to pay any Professional Tax. However, the rules and regulations applicable for Professional Tax for professionals are also applicable for those Indians who are employed by any foreign consulate, embassy, or diplomatic office, since these offices need to obtain a Certificate of Registration.

 

 

 

Is there any penalty for any delay in obtaining the ‘Certificate of Enrolment’ for Professional Tax?

 

If there is any delay in obtaining the ‘Certificate of Enrolment’, then this matter is also subject to penalty. The rate of such a penalty is Rs. 2 per day. Also, if any wrong information is furnished or provided during the time of enrolment, then the penalty is charged at three times of the due tax amount. Rs. 300 is charged by some states as penalty whenever any return is filed late.

 

 

 

Does a separate branch office of a company need to obtain a separate registration of Professional Tax?

 

Companies, be it any Private Limited Company or Partnership Firm or any other type of business entity, situated in any state or union territory that has levied Professional Tax must obtain Professional Tax Registration. Further, if any business entity has branches situated in different places with different addresses, then they must obtain a separate registration for Professional Tax for all the branch offices, based on the regulations regarding Professional Tax of the particular state or union territory where a particular branch of the business is situated.