Giudence on payment of professional tax
Pooja Khare
(Querist) 15 June 2012
This query is : Resolved
I am an Advocate. I am employed in a firm not stared my own practice yet whether still am i liable to pay my Profession tax? Please do let me about the same. And also what consequences will arose on non payment of the same?
Anirudh
(Expert) 15 June 2012
Dear Mr. Pooja,
Your question is quite tricky. It is not clear from your query, whether you want to ask about the Professional Tax being levied by the municipalities, or about the income tax being levied on Profits and Gains of a Profession.
If it is regarding the Municipal Tax, please do not get confused by the nomenclature 'professional tax'. If you really go through the particular Act through which such tax is being levied by the Municipality, you will find that the expression 'profession' would have been defined to include employment, vocation, calling etc. Therefore that has nothing to do whether a person is really a professional viz., Chartered Accountant, Lawyer, Company Secretary, Cost Accountant, Architect etc. etc. It simply means anyone who is gainfully employed in the municipal area. That's all.
However, if your query is regarding Income Tax, then my answer is as follows:
First and foremost it has to be known whether you are employed in the firm on a salary basis or on retainership/consultation fee basis (even though that retainership fee may be paid as a lump sum at the end of each month).
In the case of the former, there is an employer-employee relationship, you lose your Sanad, and you are not a professional. You are liable to pay tax (which in fact will be completely deducted by your Firm by way of TDS after taking into account your exempted savings etc.) They will give you Form-16.
In the case of the latter type of arrangement, you still retain your Sanad, you are a professional, your firm will be deducting 10% TDS, and they will give you Form 16A.
In this case you are liable to show your income as a professional income - claim allowable deductions - like use of telephone, conveyance, books, subscriptions etc. etc.
ajay sethi
(Expert) 15 June 2012
Salaried persons are also liable to profession tax but their tax is to be deducted and paid by employer. The slab rates applicable to them are as per entry 1 in the given Schedule.
The duty is cast upon the employer to deduct tax at above rates and deposit with Government. However even if not deducted, employer is liable to pay tax. For this purpose the Employer should obtain the Registration Certificate from Department within 30 days from date of his liability. There are also provisions for non deduction of tax, etc. subject to production of required form by the employee. The employer should also file the returns and pay taxes as per monthly/quarterly/annual return applicable to him
Dr J C Vashista
(Expert) 15 June 2012
If you are employed, your employer is duty-bound to pay you after TDS (TAX-DEDUCTED AT-SOURCE) and issue Form 16 to you with copy of challan of the amount deposited in treasury.
Shonee Kapoor
(Expert) 15 June 2012
Nothing left to be added.
Regards,
Shonee Kapoor
harassed.by.498a@gmail.com
