Individuals who earn their living through professional careers, labour, or businesses are subject to professional tax. The self-employed working population also pays professional taxes to the respective state government. In this regard, the payment of professional tax in Punjab is facilitated per the provisions of the Punjab State Tax on Professions, Trades, Callings and Employments Act, 1975.
But is paying this tax mandatory? How can you pay for it? Read on to find out!
Professional Tax in Punjab
Clause 2 of Article 276 of the Indian Constitution covers the payment of professional taxes in India. The Punjab government imposes a professional tax of Rs 200 per month on those who earn their income as a salary or from a business, as per the Income Tax Act of 1961.
Punjab Professional Tax Act/Rule
Professional tax is levied and collected from individuals engaged in various professions, trades, callings, and employment as per the Punjab State Development Tax Act, 2018. It came into effect on April 19, 2018. This tax is imposed as a welfare benefit for the state of Punjab; it is applicable throughout the state for offices of anybody owned by the state and offices of the government of Punjab.
Professional Tax Applicability in Punjab
Let's get a comprehensive idea about professional tax applicability in Punjab. The different categories of individuals liable to pay this tax in Punjab are:
- The person working for an organization that operates in any part of Punjab and is owned or controlled by the Central Government or any state government, regardless of whether that organization is incorporated.
- A government individual who receives a salary from the railway fund, any state government or Central Government.
- Government servants receive salaries from the revenues of Punjab state, even though their offices are outside this state.
- An employee of an organisation, whether or not it is incorporated, that is owned or controlled by Punjab and conducts business within or outside of the state.
- A person working for an employer not included in the above mentioned categories. Such an employer should be responsible for the salaries of his/her employees regularly. This may include the employer's manager or agent as well as the officer in charge of paying the salaries or wages. Sole proprietors, societies, trusts, clubs, HUF, partnership firms, institutions, local authorities, etc., are also included in the list.
Documents Required for Registration
- Proof of establishment of business such as Partnership Deed, Certificate of Incorporation, MOA & AOA or any other similar evidence.
- Proof of residence of the Partners, Director and Proprietor such as Passport, Driving Licence, Voter Card, Aadhar Card and Electricity Bill.
- Proof of the place of business such as Electricity Bill, Property Card, Agreement of Builder, Leave and License Agreement or NOC letter and Rent Receipt.
- Lease Agreement
- PAN Card
Professional Tax Slab Rate in Punjab
The imposition of professional tax in Punjab depends on the income of earning individuals. Go through the table below to know the professional tax rate in Punjab.
S N | Class of persons | Rate |
1 | All persons having income from Salary | Rs. 200/- per month |
2 | All persons having income from Business and profession | Rs. 2400/- annually |
Punjab Professional Tax Online Payment
If you are a salaried individual, the professional tax will be deducted from your salary every month. Employers can pay professional tax through online mode. Here are the steps:
- Visit the Punjab State Development tax portal and log in with your username and password.
- Under the Challan section, enter necessary details like month, year and the number of taxable employees. Click on ‘request challan’, follow the on-screen instructions, and choose the preferred payment mode to complete the transaction.
If you are self-employed, you must pay this tax directly to the state government. You need to obtain a certificate of enrolment from a designated tax officer.
Punjab Professional Tax Payment Due Date
The tax deducted by employers shall be deposited monthly by the last day of the following month. Enrollment Tax will be paid within 30 days from the end of the financial year or within 30 days from the date of registration.
Failing to file a return shall be liable to pay Rs 50 for each day of delay.
Punjab Professional Tax Late Payment Penalty
If an employer fails to deduct professional tax at the time of payment or wage or neglects to pay the tax as required by the Act, he/she is liable to pay simple interest at a rate of 2% of the amount of the tax pending for each month.
Punjab Professional Tax Exemption
Here are the individuals who are exempted from paying professional tax in Punjab:
- Individuals who are completely reliant on agricultural activity for earning.
- Senior citizens.
- Individuals earning wages on a casual basis.
Various PT Forms
Category of assessee | Application Form |
|---|---|
Application of enrollment by employer | PSDT-1 |
Application of enrollment by assessee (other than a person earning salary or wages) | PSDT-2 |
Annual Return to be filed by employer | PSDT-6 |
Annual Return to be filed by Tax Payers - Enrollment | PSDT-7 |
Paying in slip for making Payment | PSDT-8 |
Receipt for the amount of tax, Interest and Penalty | Form VII |
Final Word
Most Indian states have their own set of professional tax slab rates. All individuals liable for professional taxes must pay this before the due date. If you are an employer or self-employed individual in Punjab, paying professional tax in Punjab must be paid within the due date. The person responsible for late payment may also be subject to legal action or penalty charges.