KARNATAKA PROFESSIONAL TAX
Professional Tax is not a tax that is applicable to professionals only, it is a tax that is applicable to all kinds of professions, trades, and employment and is based on income.
Professional Tax in the State of Karnataka is administered by the “Karnataka Tax and Profession, Trade, Callings, and Employment Act, 1976.” The Act stipulates that individuals whose monthly income is above Rs. 15,000 are obligated to remit this Tax.
The provision doesn’t apply to professionals aged 65 and above and those who have held their respective professions for less than 120 days in a given year.
Applicability of Karnataka Professional Tax:
It is applicable to
1. Both Salaried and Self employed individuals to pay Professional Tax
2. For salaried employees, the professional Tax is levied by employers, whereas non-salaried professionals need to pay it to local authorities appointed for collecting the Professional Tax
3. Doctors, advocates, chartered accountants and every other individual engaged in private professions is liable to pay professional Tax in Karnataka.
Professional Tax in Karnataka is applicable to the following categories:
The professional Tax for a salaried individual will be deducted by the employer from the salary. Business entities such as:
- Sole proprietor
- Partnership firm
- Limited Liability Partnership
- Hindu undivided family (HUF)
- Company and other corporate bodies
- Club or Association
Exemptions to Certain Persons
- Foreign employees are exempt from paying professional tax.
- Individuals who run educational institutions that teach classes up to twelfth standard.
- Individuals in the Central Para Military Force (CPMF).
- An individual who has one child and has undergone a sterilization operation. However, the relevant documents must be submitted.
- Any ex-serviceman who comes under SI. No.1 (Schedule)
- Any handicapped individual who has at least a 40% disability. However, the relevant certificate must be submitted.
- Individuals who have a permit for a single three-wheeler or a single taxi to carry goods. Deaf, dumb, and blind individuals who are earning a salary.
- Civilian non-combatant and combatant members who are part of the Armed Forces. However, the Army Act must govern the Armed Forces.
- Foreign technicians who have been employed by the state. All philanthropic and charitable hospitals that are present in places that come below taluk level.
Kinds of PT Registration
Here are the two kinds of registration:
- Professional Tax (PT) employer registration
- Professional Tax (PT) employee registration
Procedure to Pay Karnataka Professional Tax
The procedure to pay Karnataka Professional Tax is explained in detail below:
Karnataka Professional Tax Enrolment
- Access the e-Prerna Portal, on the left sidebar, under the e-services section; please click on the ‘Enrolment Application’ option.
- In case you are enrolling for the first time, select ‘New’ in the category of enrolment. Furnish the required financial year for which you want to file your professional Tax.
- Select your professional tax office on the basis of the pin code of your place of work from the drop-down menu.
- If you have already enrolled before then select ‘Enrolled’ in the category of enrolment and fill in the required details including the EC (Enrolment Certificate) no. EC number is a 9-digit alphanumeric number allotted to an individual when he/she gets enrolled for the first time. You also get the option to revise the professional tax payment returns filed in earlier years.
- Select the business status as applicable.
- Select the appropriate class of person to which you belong from the drop-down menu. After selecting the class, please select the appropriate sub-class. Click on ‘Next’
- After clicking on next, you need to enter further details which include personal details like name, father’s name, date of birth, address, etc. as well as firm details in which you are working or your own.
- If you are having a partnership firm then the relevant details of the partners need to be entered.
- After entering all these details, click on ‘Next’. A screen of additional places will be displayed. Only if you are running your business at multiple places (branches), do the required details need to be entered. Click again on ‘Next’
- Now, you need to enter your tax detail as applicable. You can find the applicable tax rate to you in the PT Schedule. After entering the tax details, click on ‘Next’.
Payment of Tax
Please select the mode of payment. If you want to pay online, then select the ‘e-Payment’ option, else you can select the ‘Cheque/DD/Cash/Challan’ option. After selecting the mode of payment, click on ‘Submit’
A unique number called the ‘PTN No’ is generated which you can note down for further reference
If you had selected the ‘e-payment’ option, then go to the home page by clicking here. In the left-hand bar, please click on the ‘enrolment payment option under the e-services section
Please enter the PTR No. and the PTR date, as required click on ‘Go’ and make the online payment. Congratulations, you have deposited your professional Tax online
Penalty for Late Payment:
- In case there is a delay in payment of professional Tax, the state government of Karnataka will charge 1.25% per month for late payment.
- However, the maximum penalty the state will charge is 50% for late payment of the total unpaid professional tax amount. It is therefore advised not to forget to pay professional Tax on time or delay the payment of professional Tax.