All salaried individuals are liable to pay professional tax in Kerala. In this article we will learn about:
- Professional tax in Kerala
- Professional tax slab in Kerala
- Applicability of professional tax in Kerala
- Professional tax payment
- Professional tax exemption in Kerala
- FAQs
Professional Tax in Kerala
As per the Kerala Municipality Act 1994, professional tax is levied on every individual's income, including lawyers, Chartered Accountants, entrepreneurs, etc. However, the amount of tax payable varies depending on your income slab as set by the state government. According to the Income Tax Act 1961, the total amount of professional tax you pay in a financial year can be considered a tax deduction.
Kerala Professional Tax Act
Professional tax came into being in 1996 with the enforcement of the Kerala State Tax on Professions, Trades, Callings, and Employment Act, commonly known as the Kerala Professional Tax Act. The Kerala Municipality Amendment Act of 2015 mandates that employees earning a half-yearly salary of more than Rs 12,000 are liable to pay professional tax.
Professional Tax Applicability in Kerala
As stated earlier, every individual earning a specific half-yearly income is eligible to pay professional tax (PT) in Kerala. Take a look at the points below to understand professional tax applicability in Kerala clearly:
- Companies operating their businesses in a municipal area in Kerala for sixty days and above are liable to pay professional tax.
- Any company outside the municipal area with its head office operating from the municipal area for more than sixty days needs to pay professional tax.
- Company owners who have resided within the municipal area for more than sixty years are liable to pay professional tax regardless of the company's location.
- Individuals holding appointments, exercising calling or art professions, and transacting business within the municipal area for more than sixty days must pay PT.
- If you live within the municipal area for more than sixty days, you must pay the PT regardless of the location of your workplace.
- If you are earning from investments in a municipal area besides residing, you are liable to pay the PT.
List Of Documents For Registration
- Incorporation certificate along with Memorandum of Association and Articles of Association
- PAN Card
- Lease Agreement
- Employer Address Proof, ID Proof and photos
- Employee list with salary details
- List of Board of Directors
Professional Tax Slab Rate in Kerala
The professional tax slab rate in Kerala is stated in the table below:
Half-Yearly Income Slab | Half-Yearly Professional Tax Rate |
Up to Rs 11,999 | Not Applicable |
Rs 12,000 to Rs 17,999 | Rs 120 |
Rs 18,000 to Rs 29,999 | Rs 180 |
Rs 30,000 to Rs 44,999 | Rs 300 |
Rs 45,000 to Rs 59,999 | Rs 450 |
Rs 60,000 to Rs 74,999 | Rs 600 |
Rs 75,000 to Rs 99,999 | Rs 750 |
Rs 1,00,000 to Rs 1,24,999 | Rs 1,000 |
Rs 1,25,000 and above | Rs 1,250 |
Kerala Professional Tax Online Payment
You can pay the professional tax online after registering your profile on the official portal. Your PT will be calculated after you provide the professional details for registration. However, the professional tax online payment option is currently available for five corporations only which include Thrissur, Thiruvananthapuram, Kannur, Kozhikode and Kollam.
Kerala Professional Tax Payment Due Date
You are liable to pay the professional tax half yearly; the first half being April to September and the second half being October to March. For the first half, you should pay the tax by the 31st of August, and for the second half, by the 28th of February.
Kerala Professional Tax Late Payment Penalty
As already mentioned, you need to pay the professional tax within the said dates. Any delay in payment will attract a penalty of 1% and for non-payment, the penalty amount can be as high as Rs 5,000.
Kerala Professional Tax Exemption
As per the Kerala professional tax rule, some individuals are liable to get an exemption on professional tax. The individuals exempted from paying professional tax in Kerala are:
- Textile industry ‘Badli’ workers
- Any mentally or permanently disabled child’s or individual’s parents
- Members of the Navy, Air Force, and Army (according to the Navy Act of 1957, Air Force Act of 1950, and Army Act of 1950)
- Individuals with permanent physical disabilities
- Senior citizens above 65 years of age
- Auxiliary force or reservist members serving in Kerala.
- Agents of the Mahila Pradhan Kshetriya Bachat Yojana or the Director of Small Savings
Various PT Forms
Category of assessee | Application Form |
|---|---|
Application of enrollment by employer | Form No 4 |
Application of enrollment by assessee (other than a person earning salary or wages) | Form No 7 |
Final Word
Now that you know the intricacies of professional tax in Kerala, ensure to pay your tax on time. It will help you maintain a decent track record and avoid the hefty penalties imposed on late or non-payment of professional tax.