In continuance to the Government’s efforts to link all the data of the taxpayers, the Maharashtra Profession Tax Department has started issuing e-notices to all the persons who have a Goods and Services Tax Identification Number (“GSTIN”) in Maharashtra but have not yet taken Profession Tax registration, i.e., Profession Tax Enrolment Certificate (“PTEC”) and/or Profession Tax Registration Certificate (“PTRC”).
A person (natural/legal)having GSTIN in Maharashtrais liable to enrol for PTEC pay Rs.2,500/- per annum.
In addition, if the business is having any employee whose monthly salary is above Rs.7,500/-, the person is also required to obtain PTRC and pay tax after deducting the same from the employee’s salary as per the provisions of law.
In light of the above discussion, let us understand the requirements of law under PTEC and PTRC:
1) Who is required to take PTEC registration?
Every person (natural/legal) having GSTIN in Maharashtra is liable to enrol for PTEC.
2) Is there any exemption from obtaining PTEC/PTRC?
Yes. As per section 27A of the Maharashtra State Tax on Professions, Trades, Calling and Employments Act, 1975 (“the Act”), the following persons are exempt:
(a) the members of the Forces as defined in the Army Act, 1950 or the Air Force Act, 1950 and the members of Indian Navy as defined in the Navy Act, 1957;
(b) The badli workers in the textile industry;
(c) Any person suffering from a permanent physical disability (including blindness) or any person with Intellectual and Development Disabilities;
(d) Women exclusively engaged as agents under the Mahila Pradhan KshetriyaBachat Yojana of Directorate of Small Savings.
Further, section 3 of the Act specifically excludes Partnership Firm (whether or not registered) and Hindu Undivided Family (HUF) from payment of Profession Tax, provided that all the partners of the Partnership Firm and all the members (including the Karta) of the HUF pay Profession Tax.
3) What is the amount payable under PTEC?
Every person holding PTEC registration shall be required to pay Rs. 2,500/- per annum.
4) When is the amount payable under PTEC?
In case of the year of registration, the amount shall be payable within 30 days from the date of obtaining PTEC registration.
In case of subsequent years, the amount shall be payable on or before June 30 of the said Financial Year.
5) Is any return required to be filed under PTEC?
No
6) Who is required to take PTRC registration?
If the business is having any employee whose monthly salary is above Rs.7,500/- per month, the person is also required to obtain PTRC and pay tax after deducting the same from the employee’s salary as per the provisions of law.
7) What is the amount deductible from salary of the employees under PTRC?
| Sr No | Class of persons | Amount of tax (Rs.) |
| 1 | Salary and wage earners — Such persons whose monthly salaries or wages—
(a) do not exceed ₹ 7,500 Note: (2) In case of female employees, w.e.f. 1st April, 2015, exemption is granted for salary/wages up to ₹ 10,000/- pm |
Nil
|
| 2 | (b) Till 30th June, 2014
exceeds rupees 5,000 but do not exceed ₹ 10,000; From 1st July, 2014 to 31st March, 2015 exceeds ₹ 7,500 but do not exceed ₹ 10,000; From 1st April, 2015 onwards: (i) In case of male – exceeds ₹ 7,500 but do not exceed ₹ 10,000 (ii) In case of female – do not exceed ₹ 10,000 |
175 per month
175 per month 175 per month NIL |
| 3 | (c) exceeds ₹ 10,000 | 2,500 per annum, to be paid in the following manner:
a. 200 per month except for the month of February; b. 300 for the month of February |
8) When is the amount payable under PTRC?
If liability is less than Rs. 50,000 per annum, the amount is payable annually on or before 31st March of the said year.
If liability is Rs. 50,000 per annum or more, the amount is payable monthly on or before the last day of the month.
Further, in case of first year of registration, the amount is payable monthly irrespective of the amount of tax payable.
9) Is any return required to be filed under PTRC?
Yes.
If liability is less than Rs. 50,000 per annum, an annual return is required to be filed on or before 31st March of every year.
If liability is Rs. 50,000 per annum or more, monthly returns are required to be filed on or before the last day of the month.
Further, in case of first year of registration, only monthly returns are allowed to be filed irrespective of the amount of tax payable.
10) What are the consequences of failure to obtain PTEC/PTRC registration?
Tax:
The person shall be required to pay the amount of tax due for a period of eight (8) years immediately preceding the year in which the proceeding for registration is initiated against him.
Interest:
The person shall be required to pay simple interest @ 1.25% per month from the date of his liability to pay tax till the date of actual payment of tax.
Penalty:
The person may also be required to pay a penalty of Rs. 5 per day from the date of this liability to obtain registration till the date of his obtaining registration in case of PTRC and Rs. 2 per day in case of PTEC.
In addition, the person may also be required to pay penalty up to 10% of the amount of tax due.
With linking of the GST data with that of the Profession Tax, it has now become easier for the Government to track defaulting persons and issue them e-notices for immediate action. Considering a good stake of revenue involved, we won’t be surprised if the Government comes up with an amnesty scheme to encourage the defaulting persons to pay outstanding profession tax dues and ensure appropriate compliance.
Received such e-notice? – contact us at +91 9699111783 or just forward the e-notice to info@bhaskara.in along with your contact details.
Disclaimer: This article is for general awareness and does not represent professional opinion of the author.