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Jharkhand Professional Tax

Jharkhand Professional Tax

Jharkhand Professional Tax

Profession tax is a State Government tax imposed on a person or body earning an income by way of employment, profession, calling or trade. The State Municipal Corporations collect the professional tax through predetermined slab rates. Moreover, the paid tax can be claimed as a deduction from the salary under Section 16 of the Income Tax Act.  Different states cover different rates and methods of collection for profession tax. In this article, we look at the details of Jharkhand professional tax and its e-payment procedure. The Jharkhand Tax on Professions, Trades, Callings and Employments Act, 2011 governs the levy of tax that extends to the whole state of Jharkhand.

To know more about Professional Tax Registration and Compliance, Click here.

Who should pay?

Every person who has engaged in any employment, profession, trades, callings or transact business for a minimum of 120 days in a year are liable to pay the levied tax. The collected tax is used for the benefit of the schedule tribes, schedule castes and weaker sections of the State.  The liable persons to pay Profession Tax under the act are divided into two categories.

Employer

The employer (Public and Private Sectors, Government) is liable to deduct the Profession Tax from the salaries or wages of the salaried persons and wage earners and deposit the same with the State Government. The employer on behalf of all employees should pay the tax within fifteen days from the end of the quarter. If the employer is an officer of the State Government or the Central Government or the respective Government undertakings, or Public Limited companies, the tax should be deposited in the specified format.

Employee / Individuals

The person or the employee himself indulged in any employment, profession, calling and trade is responsible for paying the tax from the salary or wages. Salary and wages under the Jharkhand Tax on Professions, Trades, Callings and Employments Act, 1979 are described below.

Salary and wages include the following.

  • Pay, Dearness Allowance and any other amount paid as allowance.
  • Remunerations received in cash or any other kind on regular basis.
  • Honorarium, perquisites and profit in lieu of salary
  • Leave encashment amount
  • Leave concessional pay, subsistence allowance.

Salary and wage does not include the following.

  • Medical reimbursement
  • Reimbursement of conveyance charges, traveling allowance
  • Salary paid to apprentice under Apprentices Act, stipend paid to trainee
  • Statutory bonus, gratuity, and ex-gratia payment.
  • Pension granted to an employee is not considered as salary. Therefore, a pensioner is not liable to pay Professional Tax on pension.

Jharkhand Professional Tax Slabs

Every person who fall under any of the classes of assessee should pay the tax rate against it mentioned in the Schedule 3 under the Act. The Schedule 3 is presented below in the form of a table.

Entry No.

Class of Assessee

Rate of Tax

1Salary and wage earners, such persons whose annual salaries or wages:
(i) Up to Rs. 3,00,000/-Nil
(ii) Range from Rs. 3,00,001/- to Rs. 5,00,000/-1200/- PA
(iii) Range from Rs. 5,00,001/- to Rs. 8,00,000/-1800/- PA
(iv) Range from Rs. 8,00,001/- to Rs. 10,00,000/-2100/- PA
(v) Above 10,00,000/-2,500/- PA
2Legal practitioners, Technical and Professional Consultants those mentioned in the schedule and whose standing in the profession is as follows.
    (i) Up to three yearsNil
    (ii) Three to seven years1,000/- PA
    (iii) Above 7 years2500/-PA
3(i) Chief Agents, Principal Agents, Special Agents, Insurance Agents and Surveyors or loss assessors registered or licensed under the Insurance Act, 1938 (Central Act IV of 1938) whose annual income is not less than Rs. 40,000/-2,500/- PA
(ii) Pigmy Agents or UTI agents whose annual income is not less than Rs. 20,000/-300/- PA
(iii) Postal agents under the National Savings Scheme or Chief agents, principal agents, special agents whose annual income is not less than Rs. 40,000/-2,500/- PA
4Directors (other than those nominated by the Government) of Companies Registered under the Companies Act, 1956.2,500/- PA
5Dealers registered or liable to be registered under Jharkhand VAT Act, 2005 whose total turnover in any year ranges :-
(a) Upto Rs.5,00,000/-Nil
(b) from Rs.5,00,001/- to Rs.10,00,000/-1,000/- PA
(c) from Rs.10,00,001/- to Rs.25,00,000/-1,500/- PA
(d) from Rs.25,00,001/- to Rs.40,00,000/-2,000/- PA
(e) above Rs.40,00,000/-2,500/- PA

 

6

Dealers not registered or not liable to be registered under Jharkhand VAT Act, 2005 whose total turnover in any year ranges :-
(a) Upto Rs.3,00,000/-Nil
(b) from Rs.3,00,001/- to Rs.10,00,000/-1,000/- PA
(c) from Rs.10,00,001/- to Rs.25,00,000/-1,500/- PA
(d) from Rs.25,00,001/- to Rs.40,00,000/-2,000/- PA
(e) above Rs.40,00,000/-2,500/- PA
7Occupiers of factories as defined under the Factories Act, 19481,000/- PA
8Employers of establishments as defined under the Shops and Establishments Act, such employers of establishments who are not dealers
(i) Where there are no employeesNil
(ii) Where not more than 5 Employees are employed500/- PA
(iii) Where more than 5, but not more than 10 employees are employed.1,000/- PA
(iv) Where there are more than 10 employees but not more than 20 are employed2,000/- PA
(v) Where more than 20 employees are employed2,500/- PA
9(a) Owners or lessees of petrol/diesel filing stations and service stations, garage and workshops of automobiles.2,500/- PA
(b) Owners or lessees of Rice Mills, Oil Mills, Paper Mills, Dall Mills, Mini Steel Plants, Rerolling Mills, Foundries, Tanneries, Stone Crushers, Bottling Units, Distilleries, Tiles Factories, Biscuit Factories, Chemicals and Pharmaceutical Labs, Printing Presses (With power) Fruit Canning Units.2,500/- PA
(c) Owners or lessees of Nursing Home and Hospital other than those run by the State or Central Government2,500/- PA
(d) Owners or lessees of Pathological Testing Lab and X Ray Clinics.2,500/- PA
(e) Owners or lessees of Beauty Parlors, Dry Cleaners and Interior Decorators2,500/- PA
(f) Owners or lessees of Oil ghanies (with power), Oil rotaries (with power) Huller Mills, Cashew Factories, Decorticating Mills, Saw Mills, Cotton Ginning or Pressing Factories, Small Flour Mills, (working on Hire-Basis), Gum manufacturing units, Bakeries, Hosiery manufacturing units, Cement flooring or stone manufacturing units.1,500/- PA
10(a) Owners of Residential Hotels or Lodging Houses having not less than 10 rooms2,500/- PA
(b) (i) Owners of theatres2,500/- PA
(ii) Owners of touring talkies1,000/- PA
(iii) Owners of Video parlors1000/- PA
(iv) Cable TV operators including signal provider, cable hirer and their agents.2,500/- PA
11

Money lenders, licensed under the law relating to money lenders, financing agencies, for the time being in force in the State

(a) those who lend rupees fifteen lakhs and above in a year

(b) other than those specified at (a) above

2,500/- PA
1,500/- PA
12Individuals or institutions conducting Chit Funds2,500/- PA
13Co-operative Societies registered under the respective Acts and engaged in any profession, trade or calling: –
(i) State level societies2,500/- PA
(ii) Banks including Gramin Banks.2,500/- PA
(iii) District level societies1,000/- PA
(iv) Block / Panchayat level societies500/- PA
(v) Village Level Societies100/- PA
14Banking Companies as defined in the Banking Regulations Act, 19492,500/- PA
15All Companies Registered under the Companies Act, 1956 and engaged in a profession, trade or calling2,500/- PA
16Each partner of a firm engaged in any profession, trade or calling1,000/- PA
17

Chartered Accountants where the standing in profession is: –

(i) Not less than 2 years, but less than 5 years

(ii) Not less than five years

1,000/- PA
2,500/- PA
18Medical practitioners including 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,-
    (i) less than 2 yearsNil
    (ii) after two years2,500/- PA
19Engineers, RCC Consultants, Architects and Management Consultants.
    (i) less than two yearsNil
    (ii) after two years2,5 00/- PA
20Journalists600/- PA
21Advertising Firms/Agencies2,500/- PA
22Educational Institutions and Tutorial Colleges or Institutes other than those owned by the State or Central Government
i) Tutorials running classes up to 7th standard1,500/- PA
ii) Tutorials running classes up to 10th standard2,000/- PA
iii) Junior colleges and all other Educational Institutions and Tutorials running classes above 10th standard or or 10+22,500/- PA
23Property Developers including Land Developers and Building / Flat Developers2,500/- PA
24All other persons, other than those mentioned in any of the preceding entries, who are engaged in any profession, trade or calling or employments1,000/- PA

 Registration and Enrolment

  • Every employer should obtain a Certificate of Registration and should pay monthly tax and file the annual return.
  • Any self-employed person liable to pay tax under section 3 should obtain a Certificate of registration in the prescribed manner from the prescribed authority and should have the receipt of annual payment of tax, but does not require filing any of return.

Note: Every assessee (employer or employee) should obtain his or her respective certificates within sixty days of becoming liable to pay tax.

e-Payment of Jharkhand Professional Tax

The Department of Commercial taxes under the Government of Jharkhand facilitates online payment of profession tax for its citizens through the e-payment online portal.

Step 1: To make e-payment of Jharkhand professional tax, visit the official website of the e-payment portal.

Step 2: The online payment page appears. Select the tax type as professional tax and enter the required details that include the following.

  • Firm details
  • Address details
  • Payment details
  • Purpose of payment (tax fee, penalty, appeal, miscellaneous)
Jharkhand Professional Tax - e-Payment
Jharkhand Professional Tax – e-Payment

Step 3: Enter the captcha, make necessary payment and submit.

Note: The amount of tax due from the assessees for each quarter should be paid before June 30 of every year.

Exemption of Jharkhand Professional Tax

  • The person employed with the Union Ministry of Home Affairs, Union Ministry of Defence or Border Security Force is exempted from the payment of tax under the act.
  • Person with permanent physical disability
  • Parents or guardian of a person who suffer from a physical disability or mental retardation.
  • Senior citizen above the age of 65 years

Offences and Penalties

Any assessee who fails to comply with any of the rules of the Act will be punished with a fine amount between five hundred rupees and five thousand rupees. If the offence continues, a fine of ten rupees per day during the period of the continuance of the offence will be levied.

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