Professional Tax is a state levied tax on working professionals. Professional Tax in the state of Maharashtra is under the Maharashtra State Government on persons involved in various professionals, salaried individuals, salaried person, self-employed individuals, wage earners, trades, jobs, or occupations regardless of the payment details & payment type. It acts as a major player in generating revenue and to ensure that professionals contribute in the development of state. It is governed by the Maharashtra State Professions, Vocations, Vocations and Labor Act, 1975
Definition of Professional Tax (PT)
Professional Tax is an indirect state level tax, although the name suggests that this tax is placed on professionals it is not like that. Instead, any person who receives income from salary or is engaged in any business or profession for e.g. business owners. Under Section 16(iii) of the Income Tax Act, 1961, this tax is deductible from the gross income of the employee regardless of the method of payment And professional tax is a subject matter of the respective state government
What is the professional tax salary?
As per the professional tax liability laws & regulations salary income is categorized as personal income of a salaried person it includes bonus money, salary and other benefits received by the person it also includes financial & non financial grants that are received by the individual regularly. This includes traders, contract workers & many more individuals
Who is responsible for deducting professional tax (PT)
The employer has to deduct the Professional Tax apart from that any person who is not an employee must pay their taxes accordingly as mentioned earlier this includes professionals, freelance professionals, traders, businessmen and more
How is Professional Tax Calculated in Maharashtra?
The State Government of Maharashtra has some privilege and tax exemption limit for women as it is in the subject matters of the state the rate of tax can be set up by the state. The professional tax rate or professional tax rate slabs as per the income are as follows:
The calculation of Maharashtra professional tax incase of Men (maximum limit) is as Up to Rs.7,500/monthly salary Nil, From Rs. 7,501 to Rs.10,000 Rs. monthly salary 175 per month, Above Rs. 10,000 monthly salary Rs. 200 per month except for the month of February and Rs. 300 for the month of February
For Women it is Up to Rs. 25,000 monthly salary NIL, Above Rs. 25,000 monthly salary Rs. 200 per month except for the month of February and Rs. 300 for the month of February is the professional tax payable
Nonetheless, it is essential to remember that these taxable income prices are subject to change according to the Maharashtra State Government laws and regulations
What is the payment period of PT in Maharashtra?
If there are no workers an individual needs to pay an expert duty of 2500rs/year as the professional tax payment. And, incase there are workers the deduction should be done by the employer every month & this should be made till the 20th of every month
Expense and recurrence
The Employers or the business people generally deducts & gathers the tax from their workers according to the tax exemption limit. The employers are responsible for depositing the tax to the tax authority. The Notifications regarding recurrence of tax payments & refunds could differ from one state to another
Rebelliousness and Penalties
Incase of failure to confirm to the Maharashtra Professional Tax Rules can lead to penalties & legal action from the state level tax department depending who are the persons liable at fault the employee or the business people
Conclusion
In Maharashtra professional Tax is a significant tool of income for the government. As, the taxpayer & businesses keep up with the most recent professional tax guidelines rates & commitments to provide consistency with the state regulations
Frequently Asked Questions
1. What is Professional Tax in Maharashtra?
Professional Tax is a state levied tax on working professionals it includes professionals, trades, jobs, or occupations.
2. Who needs to pay professional tax in Maharashtra?
Professional tax responsibility applies to government representatives and independently employed people in Maharashtra . Professional tax is applied on the employee and it is deducted and collected from the employer and is paid to the Maharashtra state government.
3. How are professional taxes determined in Maharashtra?
Professional Tax is paid on monthly payment basis according to the individual’s monthly pay.
4. What are the Consequences of Non-Payment of Professional Tax in Maharashtra?
If an individual doesn’t pay/incur any late payments his professional tax in Maharashtra it can lead to penalties & legal action from the Tax department
5. Is Derivation and Installment of Professional Tax for Maharashtra Workers an Obligation of Business?
Yes, employers are liable for deducting & submitting the tax from the employee to the state government
