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Registration And Payments Under Karnataka Professional Tax

Profession tax is levied and collected by the State Governments in India and it is a Direct tax. A person earning an income from salary or anyone practicing a profession such as chartered accountant, company secretary, lawyer, doctor, etc or any person who are into business such as service provider, manufacturer, trader, etc. are required to pay the Professional tax.

This is basically a tax that you have to pay if you are an individual who earns and meets the particular limit. This figure normally differs between states and it is mandatory to pay professional tax if the fixed limit is crossed.

However, it does not get above INR 2500 on a yearly basis no matter which state you may be in.

It is deducted by the employer from their employee every month and remitted to the Government. The tax payer is eligible for income tax deduction for this payment

In India, profession tax is imposed every month. However, not all states impose this tax. The states which impose professional tax are Punjab, Uttar Pradesh, Karnataka, Bihar, West Bengal, Andhra Pradesh, Telangana, Maharashtra, Tamil Nadu, Gujarat, Assam, Kerala, Meghalaya, Odisha, Tripura, Madhya Pradesh, Jharkhand and Sikkim.

Now let us see what the requirements under Karnataka Professional Tax Act are.

Liability

In Karnataka, both salaried and self employed have to pay tax to the Government of Karnataka. For salaried persons, it is the responsibility of Employer to collect the tax at the time of making salary payments. In case of self-employment, they need not to pay tax if they are appointed by State Government for such purposes. In Karnataka professional taxes are levied as per the Karnataka Tax on Professions, Trades, Callings and Employment Act 1976.

PT Slab Rate for Salaried person

Salary

For Employee

Amount

Less than Rs.15000/- p.m.

1 Employee

Nil

Rs.15000/- or above 15000/-p.m.

1 Employee

Rs.200 p.m.

Documents Required for Registration

  • Certificate of Incorporation/ Partnership Deed.
  • Copy of PAN of the Company/Firm
  • AOA and MOA
  • PAN Card & Aadhaar Card copy of all the Directors/Partners/Proprietor.
  • Passport size photo of Applicant.
  • Mobile Number and Email ID of Applicant.
  • Valid Rental/Lease Agreement of the office premise. If own property tax paid receipt.
  • Recent one month’s Bank Account Statement of the Company/Firm/Proprietor
  • Salary Register
  • P.T Authorization letter.

PT Registration Process

The process of registration is simple. By visiting the website, you can apply online for registration. Go to http://pt.kar.nic.in/ link for professional tax registration and then click on the same. Then step by step you have to follow the instructions as they appear on the website.

4 simple steps to get PT enrollment & registration certificate:

  • Prepared documentation for PT registration
  • Visit to e-PRERANA website
  • For Enrollment Certificate (EC) enrollment registration is only for the Employer, click on “Enrollment Application” from left panel of e-Services and fill the details. Then make payment online, then take a print of enrollment application and after that you will get enrollment certificate.
  • For New Registration Certificate (RC) Registration is only for the Employees, click on “New RC Request”, fill the entire mandatory field, Sent OTP to Mobile number updated in the Aadhaar and Verify the number, then you will receive an Acknowledgement No. Through this you can get a RC certificate.

It takes at least 4-5 days of working time in Karnataka to get PT enrollment and registration number.

If you have to get it done in one day, you should visit the regional PT office and submit the application with all documents in physical format. Once the verifying officer is satisfied, he will issue the User credentials for your organization after which you can proceed for PT e-filing.

Note: The important thing is that the person who is going to collect login details from PT office has to take an authorization letter for him/her from organization head with seal and signature. So that he/she can be treated as the concerned person for receiving detail.

Due Date for making payment & Filing the return:

a) For employers - payment should be made annually i.e., on or before 30th April of every year. 

b) For employees- both payment & filing of the return should be done on or before 20th of every subsequent month.

Penalty: 

  • If as an employer you do not register for professional tax in Karnataka you would be charged a fine of INR 1,000. In case, you are not a business owner this fine would come down to INR 500.
  • If as an employer you do not file returns for your employees you would have to pay a fine of INR 250.
  • If you have registered for the tax and are not paying it then a fine of 1.25 per cent of the outstanding amount would be levied at you on a monthly basis. However, this can go up to a maximum of 50 per cent of the outstanding amount.

Exemption from P.T in Karnataka:

  • All the philanthropic and charitable hospitals and nursing homes that are located at places that are lower than the Taluk level in each and every District of the State need not pay this tax. This however, does not include Bangalore and the Bangalore Rural District.
  • Directors of Companies that are registered in the state and have been nominated by Financing agencies that are controlled or owned by the State Government, or any other statutory body, are exempt from this tax.
  • Technicians from other countries working in the state under appointment from the national government are exempted from paying this tax as well. However, this exemption would be applicable only for a period of 2 years from the date when the concerned professional joined his work.
  • The employee who has attained 65 years of age, tax is not deducted from him/her.
  • The employee who has employed but not worked more than 120 days in respective year, tax shall not be deducted from him.
  • Physically handicapped and blind persons are exempted from Karnataka professional tax.
  • The persons running educational institutions and teaching classes up to 12th standard or pre-University are exempted.

If need any assistance in getting PT registration for your business, please feel free to reach us at contact@msassociates.pro or call us on 080-41633750 or 9880542668.