Professional tax in our country is a state level duty to be paid by salaried individuals, merchant dealers or anyone in a profession like chartered accountant, doctor, lawyer, etc. Since it is imposed at a state level, different states have different rates and methods of calculating the professional tax. Currently, these states levy professional tax: Karnataka, West Bengal, Andhra Pradesh, Maharashtra, Tamilnadu, Gujarat, and Madhya Pradesh.
This tax first came into existence in 1949 and the power has been vested with the State Government to levy this tax as per Clause (2) of Article 276 of the Constitution of India. The amount of this tax also depends on the gross income slab of the person. The professional tax is something similar to income tax, but income tax is collected by the Central Government while professional tax is collected by the State Government.
A Private Limited Company can be formed by two persons only, by complying with the prescribed formalities of the Companies Act. With INC 29, this is the fastest way to register a company.
The biggest advantage of a Private Limited Company is that its identity is distinct from that of its members. A company is a separate person having its own rights & Obligations.
In case of death of the owner or transfer of shares, your business won’t get affected. There will be no effect on firm’s continuance.
The greatest benefit of Private Limited Company is limited liability. If any liability arises then its member is not personally affected; members are only liable for unpaid shares held by them and not more than that.Stakeholders are not liable for corporate debts and liabilities.
For example the professional tax in Karnataka is calculated as under:
Upto Rs.9,999 - Nil
Rs.10,000 to Rs.14,999 - Rs.150
Rs.15,000/- and above - Rs.200
Wheras in West Bengal, it is calculated as under:
Rs. 8500 or less - Nil
Rs. 8501 or more but less than Rs. 10001 - Rs. 90 p.m.
Rs. 10001 or more but less than Rs. 15001 - Rs. 110 p.m.
Rs. 15001 or more but less than Rs. 25001 - Rs. 130 p.m.
Rs. 25001 or more but less than Rs. 40001 - Rs. 150 p.m.
Rs. 40001 and above - Rs. 200 p.m.
To know the latest professional tax rate slabs, calculations and notifications for each state, you can call our business associate.
We can apply help you obtain professional tax registration in 5 - 10 working days.
Our Professional Tax Expert will assess your business and prepare the documentation for professional tax application with the State Government.
Application is scrutinized by the Government department. If the application is in order, professional tax registration is provided.