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Overview on Professional Tax Registration in Karnataka

The state government imposes a profession tax that is charged to both individuals and salaried workers. In Karnataka, employees who work for a company or establishment like a factory must also complete the professional tax registration process.

In Karnataka, businesses and professionals must register for professional taxes within 30 days of hiring workers and beginning their practices, respectively. The paid salary or pay must be reduced by the professional tax. However, professional tax rates vary from state to state and are restricted at Rs. 2500 annually. It is necessary to seek professional tax registration in each state where you have employees if you do.

Who in Karnataka controls professional tax?

The Karnataka Tax on Professions, Trades, Callings and Employments Act, 1976, governs professional tax in this state. In Karnataka, India, professionals and employees are required to pay professional tax if their monthly income exceeds the imposed threshold. Online tax payments for professionals are also possible.

Qualification Requirements for Professional Tax Registration in Karnataka?

In Karnataka, the employer is required by law to complete the process of professional tax registration if the employee's remuneration exceeds Rs. 10,000 per month. In such cases, the employer would be required by this statute to withhold a portion of the employee's earnings.

The employer is required to withhold the professional tax before the month's 20th day has passed.

The employer may choose to pay professional tax within 20 days of the end of the quarter of the year if the threshold or amount of professional tax payable in Karnataka is less than Rs. 5000/- per month. A professional tax registration certificate must be obtained by all employees from the relevant authority.

All people must register for professional tax, whether they are individuals or professionals. A Certificate of Enrollment must be obtained from the Profession Tax Officer if you fall under one of the categories listed in lines No. 2 through 74 of the Schedule (Annexure 1).

Who in Karnataka is required to pay professional tax?

These entities are required to pay professional tax:

  • A person employed in a public /private establishment
  • HUF (Hindu Undivided Family)
  • A person engaged in trade activity
  • Corporation/Firm
  • A professional
  • Co-operative Society
  • Businessman
  • Club or Association
  • Company
  • Other Corporate Bodies

Every branch will be regarded as a distinct entity for the purposes of tax responsibility.

What paperwork is needed to register for a professional tax ID in Karnataka?

In Karnataka, the following Documents are necessary for professional tax registration:

  • A passport-sized photo of the proprietor or, in the case of a partnership firm, the partner. Directors in the event of a business, as applicable.
  • Address evidence for the proprietor, the partners in a partnership firm, or the directors in a company, depending on the circumstances.
  • Address Establishment proof.
  • PAN (Permanent Account Number)
  • Data on employee salaries.

Financial statements must also be supplied if professional tax registration was not obtained in the first year. Financial statements must also be provided if this is not your first year in operation or if you did not already have PT registration when you started.

What is the amount of professional tax paid by the employer and what is the amount of professional tax that the employer is expected to pay on behalf of the employees?

Every employer is obligated to pay professional tax by the 30th of April each year. Employees' salaries must also be withheld for professional tax, which must then be paid to the appropriate authorities. In the schedule of the Professional Tax Act, the specifics of the professional tax that the employer must pay are provided.

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What steps are included in the Karnataka professional tax registration process?

For professional tax registration in Karnataka, the procedure is as follows:

Signing up for the E-Prerna Portal

The applicant must first visit the website. The applicant would need to click Enrolment of Application on the application's left sidebar. The applicant's professional tax enrollment must be taken into consideration if this is their first time enrolling for professional tax payment. Click to pick the new category for enrollment if the application is a new one

Choose the Company That Is Relevant to the Enrolment

The applicant must choose a suitable business for enrolment in the professional tax in the following phase. Here, the employer is required to supply information pertaining to the application. The applicant is required to identify the fiscal year for which professional tax is due. The next option, "Enrolled," must be chosen by the applicant if they are already registered to pay professional tax in Karnataka. The applicant must then enter their 9-digit alphanumeric enrolment certificate for Karnataka's professional tax. Personal information pertaining to the business must be supplied while selecting the business type and status. If a company has various locations where it conducts business, this information must be indicated in the drop-down selection on the form.

Click on the Schedule's Relevant Tax link.

The employer must next select the pertinent tax that is applicable to the particular firm in the following stage. The Karnataka professional tax schedule must be taken into account in this.

Payment

The applicant must choose the professional tax payment method in the final phase. The applicant has two payment options: online and offline. For the applicant, there is a means for electronic payment. If this is not feasible, the applicant may pay with cash, a cheque, or DD.

Following that, the candidate would receive a PTN No. or a Professional Tax No. The applicant must then submit both the professional tax number and the professional tax information. The registration process for professional taxes is then finished.

Exemptions from Professional Tax in Karnataka

The following people will not be subject to paying professional tax in Karnataka:

  • Seniors are not required to pay professional tax.
  • Apart from Bangalore and Bangalore Rural District, all non-profit hospitals and nursing facilities are located in districts below the taluk level.
  • If you are a director of a Karnataka-registered company and are also nominated by financing organisations that the State Government or other statutory authorities hold or control.
  • Those foreign technicians whose employment in the State is authorised by the Indian Government to qualify for tax exemption for the predetermined time (exemption for a period of 2 years from the joining date).
  • Members of the armed forces who fall under the purview of the Army Act, Navy Act, or Air Force Act are also exempt from professional tax in Karnataka.
  • Blind people making a living income.
  • People with disabilities who are paid salaries and wages.
  • Holders of a permit for a single taxi or a single three-wheeled goods vehicle.
  • Institutions that teach English or Kannada shorthand or typewriting.
  • A person with a physical disability who must have a 40% or greater permanent disability (subject to production of a certificate from the HOD of Government Civil Hospital).
  • But, you must present a certificate from the District Surgeon, Government Civil Hospital, if you have a single kid and have had sterilisation surgery.
  • Personnel of the Central Paramilitary Force (CPMF).

If you are responsible for a school's branches that offer classes up to the 12th grade or pre-university education.

What would happen if Professional Tax Registration, filing, and payment are not made in Karnataka?

  • Registration of Employers: The fine for an employer who fails to register for professional tax in Karnataka is Rs. 1000 and Rs. 500 in the case of any other person.
  • Registration of Employees: If an employee fails to register for professional tax, there will be a penalty equal to the tax that must be paid up until the date of payment, plus simple interest at the rate of 1.25% per month from the commencement of employment until the registration is achieved.
  • Failure to File a Return: The penalty for an employer who fails to file a professional tax return is Rs. 250.
  • Failure to Pay Tax: In the event that an enrolled individual or registered employer fails to pay their taxes, they will be subject to a penalty that cannot exceed 50% of the unpaid taxes plus interest at a rate of 1.25% per month.

Karnataka employer registration for professional tax

  • Every employer must first obtain a professional tax certificate before paying professional tax in Karnataka. To register for professional tax in the state of Karnataka, the employer must go to the e-Prerna website. After that, the employer would need to visit the newly established professional tax registration section in Karnataka.
  • The employer is required to submit all information pertaining to the firm, including the company's constitution, its line of business, and its PAN information.
  • Once this is finished, the professional tax department's office will issue a PIN in the company's name.
  • After that, the employer would need to fill out the enrolment certificate with the relevant details.
  • The applicant's 15-digit number must be placed into the system if they are enrolled for the Karnataka GST.
  • After that, by entering Aadhaar information and the registered cellphone number, the status of professional tax may be checked online.
  • With the drop-down menu, the firm application's status can be found as mentioned.

Employer Professional Tax Rate

Employer Professional Tax Due is defined as follows:

Description

Amount Payable

In case of no employees

Nil

In case of a maximum of 5 employees

Rs. 1000/- Per Annum

In case of more than 5 but not more than 10 employees

Rs. 1500/- Per Annum

In case of more than 10 employees

Rs. 2500/- Per Annum

The following turnover in any year is required of all dealers registered or required to be registered under the Karnataka Sales Tax Act of 1957 and the Karnataka Value Added Tax Act of 2003:

Description

Amount Payable

Not more than Rs. 2 lakhs

Nil

More than Rs. 2 lakhs but less than Rs. 10 lakhs

Rs. 1000/-

More than Rs. 10 lakhs but less than Rs. 25 lakhs

Rs. 1500/-

More than RS. 25 lakhs

Rs. 2500/-

Professional Tax (PT) may be deducted up to Rs. 200 per month from an employee's income when it exceeds Rs. 15,000.

How should a professional tax return be filed?

You will receive an ID Password once you have registered with the professional tax registration department in order to file a professional tax return. You can submit a professional tax return on the Karnataka government website by using this Id password. You must sign into your account to file a professional tax return, and payment must be made in accordance with any regulations, such as monthly or quarterly filing.

How can we assist you in registering for a professional tax ID?

  • Gathering all essential paperwork: Our professionals will gather the relevant paperwork for your professional tax registration in Karnataka in the first stage.
  • Registration for Professional Taxation: Preparation - Our experts will submit an application for professional tax registration with the Karnataka government based on the information and Documents provided.

You must now fill out an inquiry form on our website and click the Get Started button in order to finish this procedure. Your question will be answered when our expert calls you back. Your order number will be generated by our system following the initial payment and assigned to a specific in-house CA.

Frequently Asked Questions

In Karnataka, the minimum wage that must be paid in professional taxes is Rs 10,000.

Sure, you can pay your professional taxes online.

Yes, you can register for professional taxes in India using either the offline technique or the internet mode.

Indeed, the applicant would receive a special enrollment number for paying professional tax.

In Karnataka, professional tax registration does not require the applicant to be present and professional tax payments are entirely made online.

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