How to File Your Professional Tax Return: A Step-by-Step Guide

Introduction

For those who are responsible for paying professional tax, both individuals and businesses must file professional tax returns. The State Government imposes a Professional Tax on salaried individuals, professionals, and those involved in any trade, calling, or occupation. 

On the other hand, a professional tax return is a record that a person or corporation files with the state government that includes information about the taxes they have paid. Professional tax return filing can be a complicated and drawn-out procedure. 

Lawgical Adda helps customers meet their tax obligations by offering professional tax return filing services. At Lawgical Adda, our team of professionals makes sure that filing your PT return is a simple and quick process. 

Professional Tax Return

Any person or business that is required to pay professional tax must file a professional tax return. This document, which is relevant for the PT annual return, details the income produced by the person or business and the taxes paid throughout the fiscal year. 

The Professional Tax Return is submitted to the appropriate department of state government.

Why Professional Tax Violation Should Be Avoided

Incorrectly filed returns or late professional tax payments may result in penalties and fines.

You could be subject to significant interest on the amount of overdue taxes in addition to fines and penalties.

Professional tax infractions may lead to legal action and prosecution. Professional tax offenders run the danger of losing their professional licenses and exemptions. 

Complications like tax notifications, audits, and assessments may arise from noncompliance. A loss of confidence with clients, partners, and stakeholders can result from reputational harm.

Professional Tax Slab Rate

State-by-state variations exist in the Professional Tax slab rate in India. Based on the taxpayer’s income, each state determines its professional tax slab and rate. Typically, various categories comprise the Professional Tax slab rate, including:

1. Income each month of less than Rs. 15,000.
2. Between Rs. 15,001 to Rs. 25,000 per month in income
3. Income per month more than Rs. 25,000

Remember that since professional tax is a state-level tax, each state may have a different slab rate. When completing professional tax returns, taxpayers must abide by the applicable requirements in their states.

Expert Tax Return Processing

Registration

In order to receive a professional taxpayer certificate, employers and independent contractors must register with the relevant local authorities. They must provide proof of identity, residency, and business verification as part of the application procedure.

Tax Calculation

The rates and slabs for each state or union territory are used to calculate the professional tax amount. 

The relevant rates depend on a number of criteria, including your income and occupation. While self-employed professionals calculate professional tax based on income and rates, employers deduct professional tax from employees’ salaries or earnings.

Filing of Returns

In order to receive a professional taxpayer certificate, employers and independent contractors must register with the relevant local authorities. They must provide proof of identity, residency, and business verification as part of the application procedure.

Tax Remittances

Professional tax payments must reach the government prior to the tax deadline. Online payments via a payment form or challan are accepted on government websites. As an alternative, you can deposit it in person offline.

Record-keeping

Professional tax payments and deductions must be accurately documented by employers, professionals, and independent contractors. In order to ensure compliance and future reference, they must also keep the challans, returns, and enrollment certificates on file.

Employer’s Responsibilities for Filing PTRC Returns

According to the rules, the employer must take professional Tax out of the paychecks of their staff members and send the money that is withheld to the appropriate government agency. 

In addition, the employer needs to submit evidence of their tax payment by filing a Professional Tax Return in the required format by the deadline. 

The file will be deemed complete and void if the proof of payment is enclosed with the return, in which case the relevant authorities will take appropriate action.

The consequences of not filing a professional tax return

According to each state’s professional tax laws, there may be different penalties for not filing a Professional Tax (PT) return on time or for withholding payments after the deadline. 

Companies risk fines, late fees, or even jail time if they fail to register for PT, pay taxes after the deadline, or both. Penalties also apply for failing to file a return by the deadline or for making a late payment.

For instance, the government of Maharashtra levies a fine of Rs. 5 per day if you fail to get PT registration. Rupees One Thousand for the Professional Tax Return Filed Delayed. 

If PT dues are not paid on time, there will be a 10% penalty and interest at the rate of 1.25% per month.

Ready to file your Income Tax Return? Whether it’s ITR-1, ITR-2, ITR-3, ITR-4, ITR-5, ITR-6, or ITR-7, we’ve got you covered! Need to respond to a tax notice or handle TDS filings? We can help with that too. 

Lawgical Adda’s solution provides end-to-end management of corporate governance and secretarial compliances, encompassing every phase of the entity life cycle. Don’t hesitate to get in touch with us if you want more information on the compliance standards and to outsource them to us.