Professional Tax applicability in Assam

Professional tax applicability is levied by state government on individuals. Individuals who are employed and earn regular salary. The employer has to deduct PT from gross salary and deposit with government.

The Article 276(2) in The Constitution of India 1949 permits state government to charge professional tax, the maximum limit is Rs. 2,500. Further, Professional tax is governed by The Assam Tax on Professions, Trades, Callings and Employment Act, 1947.

Who are liable to pay professional tax?

Professional tax is applicable to followings:

Individuals;
Companies registered under Companies Act, 2013;
Limited Liability Partnerships (LLP);
Hindu Undivided Family;
Corporations;
Co-op Societies and Associations;
Clubs;
Lawyers and Legal practitioners;
Contractors;
Architects;
Engineers;
Insurance agents;
Chartered Accountants (CA);
Company Secretary (CS);
Surveyors;
Tax consultants;
Owners of lessees of Petrol/Diesel filling stations and service stations;
Licensed money lenders under the Assam Money Lenders Act, 1934;
Individuals or Institutions conducting Chit Funds;
Film distributors and Travel agents;
Management consultants and
Doctors and other medical representatives.

Who has liability to deduct and pay to government?

For employees, their employer is liable for deducting and paying the said amount to respective state government.

The employer has to register himself under professional tax and get certificate.

Individual tax deduction will be based on the slab rates given below.

Exemption from Professional Tax applicability:

The below mentioned persons are exempt from paying PT:

Person who served force (Army, Air and Navy);
Person suffering from mental or physical disability.
Parent of disabled child.
Temporary worker;
Person running an education institution and
Any individual of above 65 years;

Is deduction in income tax available?

Yes, deduction under Section 16(iii) of Income Tax Act, 1961 is available.

Rate of tax:

For Salary and wage earners such persons whose monthly salaries or wages are: if salary is

S.no	Salary Slab	Tax rate
1.	Up to Rs.10,000/-	Nil
2.	More than Rs.10,000/- but less than Rs.15,000/-	Rs. 150 per month
3.	Rs.15,000/- or more but less than Rs.25,000/-	Rs.180/- per month
4.	Rs.25,000/- and more	Rs.208/- per month

For other individuals, please refer to the below link for category wise tax rate:

Professional Tax Rates

Penalties under professional tax:

If person delay in receiving registration certificate; employer has to pay Rs. 5 per day for delay. In case of self-employed penalty will be Rs. 2 per day.
If delayed in payment, pay penalty @2% per month.
In case of non-payment penalty will be 10% of tax amount.
Delay in filing the tax return is 1 month than penalty will be Rs. 1000. If filed after 1 month penalty will be Rs. 2000.
If person provide false information at time of registration, penalty will be 3 times of profession tax.

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