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Soumya Bajpai
| Updated: 29 Oct, 2020 | Category: Professional Tax Registration

Let’s Understand the Concept of Professional Tax in Tamil Nadu

Concept of Professional Tax in Tamil Nadu

Professional Tax is the state government direct tax imposed on an income earned by a wide range of people pursuing different professions. The tax gets deducted from salaries of all employees on a monthly basis.

When this involves any company, directors of company, partnerships, individual partners, or any self-employed businesses, then it will be deducted from a gross turnover of the company as recorded in a previous financial year. In certain cases, the disbursement of tax is preset; which means that it is to be paid irrespective of what the turnover is. The slab for professional tax in Tamil Nadu varies from other states across India.

Professional Tax in Tamil Nadu

Tamil Nadu is one of the states in India which actually levies professional tax on the citizens. Anyone who receives a salary or any sort of income from profession will come under the professional tax structure. The tax is compulsory, and one can also claim the income tax deduction on the amount paid as the profession tax.  Article 276 of Constitution of India states that a total amount payable as profession tax must not exceed Rs. 2500. Moreover, the registration process for professional tax in Tamil Nadu[1] can be completed online.

Read our article:Mandatory Documents Required for Professional Tax Registration in India

Revised Professional Tax in Tamil Nadu

According to the recent changes, the slab of the professional tax in Tamil Nadu has been revised. Now, this involves a new provision of tax on employment as well as on professions and trades.

Revised Professional Tax in Tamil Nadu

According to the Tamil Nadu Municipal Laws 2nd Amendment Act 1998, section 138 C states that if any individual occupied in any profession, trade, employment and calling in the city limits of the Corporation of Greater Chennai, then must have to pay the half-yearly Professional Tax. It must be calculated based on a gross income that is as follows:

Average Monthly Income (For Half-yearly)   Revised Profession Tax (For Half-yearly) Old Profession Tax (For Half-yearly)
Up to 21,000 NIL NIL
21,000 to 30,000 Rs. 135 Rs. 100
30,000 to 45,000 Rs. 315 Rs. 235
45,000 to 60,000 Rs. 690 Rs. 510
60,000 to 75,000 Rs. 1025 Rs. 760
75,000 and above Rs. 1250 Rs. 1095

Exemption from Professional Tax in Tamil Nadu

The following is the list of individuals who can be exempted from the profession tax in Tamil Nadu:

  • Any person who has crossed the age of 65 years
  • Guardians or  parents with any mental disability
  • Women agents who involved exclusively under Director of Small Savings or Mahila Pradhan Kshetriya Bachat Yojana
  • People who have the permanent physical disability, e.g. blindness
  • Badli workers in Textile industry
  • Military personnel of the forces as delineated under the Army Act 1950, the Air Force Act 1950, and the Navy Act 1957, along with the members of the auxiliary forces or reservists working for a state.

Professional Tax in Tamil Nadu for New Businesses

There are some key rules and regulations one has to follow pertaining to professional tax in Tamil Nadu. The key rules are as follows:

  • Registration application must be made to the assessee’s state tax department within the time period of 30 days
  • Mandatory Registration of employees within the time period of 30 days of employment has to be done
  • The professional tax amount has to be deducted from the salary of the employee
  • In the case there are 20-plus employees, the payment must be made within the period of 15 days from a month
  • If there are less than 20 employees, payment must be made every quarter of the year
  • In case the assessee has multiple places of work, then an application must be sent to each authority under the respective jurisdiction
  • The last date for filing of returns for profession tax in Tamil Nadu is the last day of September and the last day of March (twice a year).

Tamil Nadu Profession Tax Payment Procedure

Professional tax must be paid from the commencement of half-year that is from the month of September and March. Payment must make to all zonal offices of a respective municipal authority within the state of Tamil Nadu by demand draft or cheque. In the case of Greater Chennai Corporation, payment of profession tax must be done online by visiting the website of GCC as explained in the steps as below:-

  • Step-1 Log on to Greater Chennai Corporation website and then click on ‘Online Payment’ option shown on the left side.
  • Step-2 Then select and click on to the ‘Profession Tax tab’ shown among various options.
  • Step-3 Now, log on to a new page using the user name and password. In case you are not the registered user, then register yourself first by clicking on the option ‘Not Registered’.
  • Step-4 Now know about your profession tax due amount using the profession tax number as mentioned on the profession tax payment receipt of any earlier year.
  • Step-5 Thereafter an Online payment for profession tax in Tamil Nadu can be made by using credit card, debit card or net banking of major banks in India.

Documents Required for Professional Tax Registration in Tamil Nadu

The list of documentation required for the Professional Tax Registration under profession tax rules are as follows:-

Conclusion

There are many different types of taxes which are imposed on the citizens such as income tax, corporate tax, capital gains tax, customs duty, etc. The common direct tax imposed by the state government is the professional tax. We at Corpbiz happily offer the services of Professional Tax Registration. Feel free to contact us as we are there for you help and guidance.

Read our article:Guide on Professional Tax Registration Process

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Soumya Bajpai

Soumya has done LLB (Hons) and has a 2+years experience in writing. Her main interest is in reading judgments, new enactments and amendments taking around in law. She always strives to bring the best to work that she does.

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