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 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 professional tax. This article looks at the details of Puducherry Professional Tax and its e-payment procedure. The Puducherry Municipalities (Amendment) Act, 2017 governs the levy of a tax on the whole territory of Puducherry.
Applicability of Puducherry Professional Tax
Every person who has engaged in any employment, profession, trades, callings, or transacts business for a minimum of 120 days in a year is liable to pay the levied tax. The responsible 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. Suppose the employer is an officer of the State Government, the Central Government, the respective Government undertakings, or Public Limited companies. In that case, they should deposit the tax in the specified format.
Employee / Individuals
The person or the employee 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 amounts paid as allowance.
- Remunerations are received in cash or any other kind on a regular basis.
- Honorarium, perquisites, and profit instead of salary
- Leave encashment amount
- Leave concessional pay and subsistence allowance.
Salary and wage do not include the following.
- Medical reimbursement
- Reimbursement of conveyance charges, traveling 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 a salary. Therefore, a pensioner is not liable to pay Professional Tax on a pension.
Requisites for Tax Payment
An Employer requires a Certificate of Registration, monthly payment of tax, and filing of the annual return.
The self-employed person requires the Certificate of Enrolment and an annual tax payment receipt but does not require filing any return.
Professional Tax in Puducherry
| Half-yearly Income | Half Yearly Tax in Puducherry |
| Up to Rs.99,999 | Nil |
| Rs.1,00,000 to Rs.2,00,000 | 250 |
| Rs.2,00,001 to Rs.3,00,000 | 500 |
| Rs.3,00,001 to Rs.4,00,000 | 750 |
| Rs.4,00,001 to Rs.5,00,000 | 1,000 |
| 5,00,001 and above | 1,250 |
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. For 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 the 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.
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 citizens above the age of 65 years
- A person with the permanent physical disability
- Parents or guardians 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 deposits late, a penalty will be levied.
- The officials have the power to recover the undeposited amount along with applicable penalties and interest from the assets of the such a defaulter. In severe cases, a prosecution case can also be filed.
