Professional Tax Kerala: Tax Slab, Payment, Applicability, Login, Due Date, Exemption

• Businesses, freelancers, and salaried employees have to abide by professional tax regulations in Kerala.
• The government of Kerala has a user-friendly online payment system for professional tax.
• Senior citizens, handicapped persons, and farmers are exempted from paying professional tax in Kerala.
• Non-payment of professional tax in Kerala may lead to penalties and legal actions.

Professional Tax (PT) is a state tax collected from salaried and self-employed who derive income from employment, business, profession, or trade. The Kerala Government administers this tax through the Kerala Municipality Act, 1994 and the Kerala Panchayat Raj Act, 1994.Taxpayers need to understand the professional tax slabs, payment processes, exemptions, and compliance. So, let's begin.

The Kerala Professional Tax Act, or the Kerala State Tax on Professions, Trades, Callings, and Employment Act, was enacted in 1996. Employees drawing a half-yearly salary of over ₹12,000 have to pay professional tax under the Kerala Municipality Amendment Act 2015. Also Read - Find out why it is important to pay tax to the government

As already stated, all people in Kerala earning a specified amount of money within six months are obliged to pay professional tax (PT).To better understand professional tax applicability in Kerala, keep the following in mind:

• Companies that have been established in a Keralite municipality for sixty days or more must pay professional tax.
• Professional tax has to be paid by any company outside the municipal area, having its head office in the municipal area for over sixty days.
• Irrespective of the location of the company, businesspersons who have resided in the municipality for over 60 years need to pay professional tax.
• Individuals who have appointments, engage in calling or artistic occupations, or carry on business in the municipality for more than sixty days are liable to pay PT.
• Wherever you are employed, you have to pay the PT if you reside in the municipal area of Kerala for over sixty days. You also need to pay the PT if you earn income from investments in the municipal area.

The professional tax in Kerala is calculated based on your monthly wage or income. The current slab rates are as follows:

In Kerala, professional taxes are paid twice a year, in August and February.

The office head or employer will review every employee's salary subject to tax before the last day of August and February of every year and remit it to the municipality.The steps show the registration process: Step 1 Within the specified time frame mentioned in the notice, the head of the office has to submit the information in an application form to the concerned municipality secretary along with the relevant documents.The application form is required to be submitted with the following details: Name of the employee, designation, half-yearly income, and the tax amount. Step 2 The secretary will record the names of the offices or institutions in a professional tax register maintained by him after he receives the information provided to him. Then, a remittance receipt will be issued. Step 3 The Secretary shall issue a formal receipt for the paid amount under the heading of the name of the office once they receive the payment. Step 4 Every taxpayer shall be issued a certificate of recovery and payment of taxes to the municipality for the half-year by the head of their own office. Also Read - Here's a quick guide to the meaning of tax liability

To register for professional tax payment, the following documents are needed:

• PAN Card
• Lease agreement
• Employer address proof, ID proof, and photographs
• Employee list with salary details
• Articles of Association and Memorandum of Association
• Incorporation Certificate

To make tax payments easier, Kerala provides an online payment system for tax. To pay professional tax online, follow these steps: Step 1 - Visit the Official Website Access the Kerala Local Self Government Department (LSGD) website. Step 2 - Login/Register Login to your account using your credentials or register for a new one. Step 3 - Proceed to the Professional Tax Section Select the relevant assessment year and tax value. Step 4 - Choose Payment Mode Payments can be made through net banking, debit/credit cards, or UPI. Step 5 - Make the Payment Enter the instructions on-screen to make the payment. Step 6 - Download Payment Receipt Store the receipt for future use and tax purposes.

Deadlines and Penalty for Professional Tax Payment

You are required to pay the professional tax in Kerala in August and February.

• For each delay in payment, there will be a 1% penalty.
• A penalty of up to ₹5,000 can be levied for default.

Kerala's Professional Tax Exemptions

Some individuals might qualify for a professional tax exemption under the Kerala professional tax regulation.In Kerala, the following individuals are exempted from paying professional tax:

• "Badli" employees who are employed in the textile sector.
• Parents of any child or individual suffering from a mental or permanent disability
• Permanent physical disability holders.
• Professionals aged persons above 65 years.
• Members of the auxiliary force or reserves serving in Kerala.
• Officials of the Mahila Pradhan Kshetriya Bachat Yojana or the Director of Small Savings.
• Members of the Navy, Air Force, and Army (as classified by the Navy Act of 1957, Air Force Act of 1950, and Army Act of 1950).

Professional tax in Kerala is an important compliance requirement for salaried personnel, self-employed professionals, and companies. Awareness of slab rates, payment dates, and exemptions enables you to comply with the regulations of professional tax in Kerala.Employers are required to deduct and remit the tax on employees' behalf, and self-employed persons are required to pay it twice a year. With online payment facilities, compliance is facilitated, and taxpayers are in a position to comply in time.Focus on tax planning to find your professional tax liability. You can invest in eligible avenues to reduce your tax liability and also use eligible expenses to lower your income.Compliance with proper professional tax norms will assist businesses and individuals in avoiding penalties and remaining compliant with the tax norms of Kerala.