Professional Tax Registration

Overview

Professional tax is a tax levied by state governments on income earned through employment, profession, trade or calling. Employers who pay salaries must obtain a Professional Tax Registration Certificate (PTRC) to deduct professional tax from employees' salaries and deposit it with the state. The tax rates, slabs and due dates vary from state to state, and a few states do not levy it at all.

Objective

To enable an employer to lawfully deduct professional tax from employee salaries and remit it to the state government.

Characteristics

• Levied and administered by individual state governments, not the central government
• PTRC is required by employers to deduct and deposit tax on behalf of employees
• Slabs, rates and periodicity of returns differ across states
• Applicable only in states that have enacted a professional tax law
• Subject to periodic return filing and payment deadlines set by the state

Eligibility

• Employers paying salaries or wages to staff in a state that levies professional tax
• Companies, firms, LLPs and proprietorships with employees in applicable states
• Businesses crossing the salary or employee thresholds prescribed by the state
• Establishments operating within the jurisdiction of a state professional tax authority

Governing law

• Respective State Professional Tax Acts (for example, the Maharashtra State Tax on Professions, Trades, Callings and Employments Act, 1975)
• State Commercial Tax or Professional Tax Department

The process

1. 1
   Assessment

   We confirm whether the state of operation levies professional tax and identify the applicable slabs and thresholds for your establishment.

2. 2
   Document preparation

   We collect and organise the entity, address and employee details required by the state portal.

3. 3
   Application filing

   We file the PTRC application on the relevant state's professional tax or commercial tax portal.

4. 4
   Verification and issuance

   We respond to any queries from the department and obtain the Professional Tax Registration Certificate.

Documents required

• PAN of the business entity
• Certificate of incorporation, partnership deed or proprietorship proof
• Address proof of the place of business
• Details of employees and salary structure
• Bank account details of the entity
• Identity and address proof of the proprietor, partners or directors

Benefits

• Enables lawful deduction and deposit of professional tax
• Helps the business stay compliant with state tax obligations
• Reduces the risk of penalties and interest for non-registration
• Supports smooth payroll and statutory compliance processes

Frequently asked questions