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Puducherry Professional Tax

Puducherry Professional Tax

Puducherry Professional Tax

Professional tax is a levy imposed by the respective State Government on the income earned by a person or a body by way of employment, profession, calling or trade. The State Municipal Corporation collects professional tax through predetermined slab rates. Under Section 16 of the Income Tax Act, the paid tax can be claimed as a deduction from the salary.  Different states cover different rates and methods of collection for profession tax. In this article, we look at the details of Puducherry Professional Tax and its e-payment procedure. The Puducherry Municipalities (Amendment) Act, 2017 governs the levy of the tax to the whole territory of Puducherry.

Liable Persons

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 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 being an officer of the State Government or the Central Government or the respective Government undertakings, or Public Limited companies, should deposit the tax 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 Puducherry Municipalities (Amendment) Act, 2017 are described below.

Salary and wages include the following.

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

Salary and wage do not include the following.

  • Medical reimbursement
  • Reimbursement of conveyance charges, travelling allowance
  • Salary paid to apprentice under Apprentices Act, the stipend paid to the 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 a pension

Requisites for Tax Payment

An Employer requires Certificate of Registration, monthly payment of tax and filing of the annual return.

The self-employed person requires the Certificate of Enrolment, receipt of annual payment of tax, but does not require filing any of return.

Professional Tax in Puducherry

Half yearly IncomeHalf Yearly Tax in Puducherry
Up to Rs.99,999Nil
Rs.1,00,000 to Rs.2,00,000250
Rs.2,00,001 to Rs.3,00,000500
Rs.3,00,001 to Rs.4,00,000750
Rs.4,00,001 to Rs.5,00,0001,000
5,00,001 and  above1,250

Payment of Tax

The professional tax should be paid or deducted in January and July for every year. the arrear dues for the whole previous year will be collected in the month of February.

Professional Tax Registration and Returns

The application for the Professional Tax Registration must be done to the assessee’s state tax department within 30 days from the start of business in case of professionals or employing staff in the business. A taxpayer who has more than one place of work, the application should be made separately to each authority under the jurisdiction of the concerning workplace.

An employer who has more than 20 employees should pay the tax within 15 days from the end of the month. However,  an employer who has less than 20 employees, should pay the tax before 15th of the preceding month from the end of the quarter.

Online Payment of Tax

The taxpayer can pay the Puducherry professional tax through the online portal ‘Paysoft’ of the Government of Puducherry.

Puducherry Professional Tax - Paysoft
Puducherry Professional Tax – Paysoft

Exemption of Puducherry 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.
  • Senior citizen above the age of 65 years
  • Person with the permanent physical disability
  • Parents or guardian of a person who suffers from a physical disability or mental retardation.

 Penalty

If the liable person to pay the tax fails to get the registration, a penalty for the period during which he remains unregistered will be charged.

In case the assessee fails to deposit the collected tax to the Government or deposit late, a penalty will be levied.

The officials have the power to recover the undeposited amount along with applicable penalty and interest from the assets of such defaulter. In severe cases, prosecution case can also be filed.

Post by Marlin Priya

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