Guide on Telangana Professional Tax (PT) — Explained

This document covers

1. What is Professional Tax?
2. Types of Professional Tax registrations
3. Time Limit for registration under Professional tax
4. Amount of Professional tax to be paid
5. Persons exempted from paying Professional Tax
6. How to pay professional tax in Telangana
7. Due Date of Professional tax payment and return
8. Penalty under Professional Tax
9. Allowability of deduction under Income tax

1. What is Professional Tax?

• Professional tax is a tax levied by the State Government.
• The Commercial Taxes Department is the nodal agency and held with the responsibility of collection of professional tax from professionals in the state.
• Professional tax in Telangana is covered by Telangana professional tax Act 1987.
• Professional tax is levied on Professions, Trades, Employment and callings in a state.

2. Types of Professional Tax registrations

There are 2 types of professional tax registrations

1. Enrolment Category:

   ---

   • Any person (except a person earning salary or wages) who is carrying on any trade or profession is required to get register under professional tax under "Enrolment Category". All the taxpayers registered under GST is mandatory required to get registered under Enrolment category.
2. Registration Category:

   ---

   • If any person is having employees and he is paying wages or salaries to them, he is required to deduct professional tax from their salaries or wages and pay to Government. He is required to get registered under Registration category in this situation.

3. Time Limit for registration under Professional tax

The time limit for application of registration under professional tax is within 30 days of becoming his liability to pay tax

4. Amount of Professional tax to be paid

Below are the amounts of professional tax to be paid by different class of persons

• Salaries and Wage Earners (Employees):
  
  

  S.No	Salary or Wages per month	Professional tax
  1	Upto Rs 15,000	Nil
  2	Rs 15,001 to Rs 20,000	150 per month
  3	Above Rs 20,000	200 per month

  
  
• Legal practitioners, Solicitors, Notaries, Tax Consultants, Chartered Accountants, Technical and Professional Consultants, Engineers, RCC Consultants, Architects, Management Consultants, Estate Agents, Chief Agents, Principal Agents, Special Agents, Insurance Agents, Surveyors or Loss assessors registered or licensed under the Insurance Act, 1938 (Central Act IV of 1938), Pigmy Agents, UTI agents, Authorized assistants and Sub brokers recognized by SEBI, Commission Agents, Dalals, Brokers, Auctioneers, Medical Practitioners, Journalists, Medical Consultants (Other than Practitioners of Ayurvedic, Homeopathic and Unani systems of Medicines), Dentists, Radiologists, Pathologists and persons engaged in other similar professions or callings of a Paramedical nature, whose standing in the profession is:
  
  • Upto 5 years of profession – Nil
  • More than 5 years – Rs 2500 per annum
• Business (Sole proprietorship business) with annual turnover as below
  
  • Below Rs 10 lakhs – Nil
  • From Rs 10 lakhs to Rs 50 lakhs – Rs 1250 per annum
  • Above Rs 50 lakhs – Rs 2500 per annum
• Directors of Private Limited Companies / One Person Companies- Rs 2500 per annum per each director
• Partners of Partnership Firm/LLP – Rs 1250 per annum per each partner
• Persons other than above who are engaged in any profession, trade or calling or employment with annual income of more than Rs 1,80,000/- - Rs 2500 per annum

5. Persons exempted from paying Professional Tax

Below persons are exempted from paying Professional Tax

• Agriculturalist
• Persons engaged in performing religious duties
• Skilled persons that is to say Gold Smith, Black Smith, Pot Maker, Basket Maker, Washerman, Barber, Cobbler, Tailors, Carpenters, Masons, Plumbers, Book Binder, Toddy Tappers and Electricians
• Physically Handicapped persons with 40% or more disability of any kind
• Dry Cleaners

6. How to pay professional tax in Telangana

• Go to https://tgct.gov.in/tgportal/DLRServices
• Select type of tax as "Professional tax"
• Enter your TIN
• Select the Purpose as “Return tax” and payment type as "Monthly or Yearly" as applicable
• Enter the tax period and enter the amount
• Click on submit and make the payment

7. Due Date of Professional tax payment and return

The due date for payment of professional tax is 10th of the following month.

8. Penalty under Professional Tax

The various penalties under Professional Tax are as follows:

• Wilful non-disclosure of information or attempt to evade the tax – 300% of Professional tax
• Non filing of returns – Rs 100 per day
• Failed to apply PT registration – Rs 20 per day
• Fails to maintain the books – Rs 5 per day

9. Allowability of deduction under Income tax

• Salaried People: The employees can claim the deduction of professional tax deducted u/s 16(ii) of Income Tax Act. The deduction of professional tax can be claimed under Old tax regime
• Business people: The business people can claim the professional tax paid to the Government as an expense from the revenue.