What is Professional Tax?
Professional tax (PT) is a state tax on income from employment, professions, trades and callings. In Bangalore it is governed by the Karnataka Tax on Professions, Trades, Callings and Employments Act, 1976 and collected by the Karnataka Commercial Taxes Department. No person pays more than ₹2,500 a year, and the PT you pay is deductible from your taxable salary for income tax.
PTRC and PTEC: Which One Do You Need?
- PTRC (Registration Certificate) for employers. Once you pay salaries in Karnataka, you must deduct PT from eligible employees and deposit it with the state every month.
- PTEC (Enrolment Certificate) for the business or professional itself: companies, LLPs, partnership firms, proprietors, and professionals such as doctors, lawyers, CAs and consultants. It is paid once a year.
A private limited company or LLP with staff in Bangalore normally needs both certificates.
Professional Tax Rates in Karnataka
- Salary below ₹25,000 a month: no professional tax
- Salary of ₹25,000 a month or more: ₹200 a month
- Annual cap for any person: ₹2,500
Our Professional Tax Services
- PTRC and PTEC registration on the Karnataka PT portal
- Monthly PT calculation and payment for your payroll
- Annual PTEC payment and PT returns
- Catching up on missed registrations, payments and notices
Frequently Asked Questions
Who needs professional tax registration in Bangalore?
In Karnataka, every company, LLP, firm, proprietor and self-employed professional needs a Professional Tax Enrolment Certificate (PTEC). Any employer that pays salaries also needs a Professional Tax Registration Certificate (PTRC) so it can deduct PT from employees and pay it to the state.
What is the difference between PTRC and PTEC?
PTRC is the employer registration used to deduct and deposit professional tax on employees' salaries. PTEC is the enrolment for the business or professional itself, which pays its own professional tax once a year. Most companies in Bangalore need both.
How much professional tax is payable in Karnataka?
Employees earning ₹25,000 or more a month have ₹200 deducted each month. No PT is deducted below that salary. The total payable by any person cannot exceed ₹2,500 a year, which is the limit set by the Constitution.
When is professional tax paid in Karnataka?
Employers deposit the PT deducted from salaries every month, by the 20th of the following month. Businesses and professionals holding a PTEC pay their own annual PT once a year, by 30 April.
What is the penalty for not registering for professional tax?
Late registration, late payment and late returns attract penalties and interest under the Karnataka Tax on Professions, Trades, Callings and Employments Act, 1976. Unpaid PT also shows up during due diligence and bank or investor checks, so it is cheaper to register on time.
Which documents are needed for PT registration?
PAN of the business, certificate of incorporation or partnership deed, address proof of the place of business, PAN and Aadhaar of the directors or partners, bank details, and the number of employees with their salary details for PTRC.
Call Now
WhatsApp