Professional Tax I Meaning I Professional Tax Rate I Payment Procedure

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Professional tax is not only a tax which is levied on professionals, It is a tax which is applicable on all kinds of professions, trades, and employment and it is levied based on the income obtained from such a profession, trade and employment.

It is a kind of tax on income which is levied by the State Government. Please note, not all states in the country chose to levy professional tax. It may be noted that professional tax is a deductible amount for the purpose of Income-tax Act, 1961 and can be deducted from taxable income.

The commercial tax department of the respective states collect it which ultimately reaches the fund of municipality corporation. Professional tax may be paid either online/offline. Further, depending on the State’s requirement, a professional tax return also needs to be filed at specified intervals.

While the actual amount of penalty or penal interest may depend on the respective State’s legislation, a penalty may be levied by all such states for not registering once professional tax legislation becomes applicable. Further, there are also penalties for not making the payment within the due date and also failing to file the return within the specified due date.