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Professional Tax Registration

Start your Private Limited Company (Pvt Ltd) Registration process online at the Reasonable Price.

₹ 9663 /-

excl of GST  

What is Professional tax Registration?

Professional Tax Registration is a requirement in India for individuals and organizations working in a variety of professions, trades, and employments. This tax is imposed to fund local government operations and is governed by state-specific legislation.


To register, you must first determine your eligibility based on your income, profession, or occupation. The application process entails submitting required documents such as a PAN card, address proof, and registration costs. The application is verified by state authorities, and upon successful processing, a certificate of registration is granted.


To prevent fines, it is essential to comply with continuing obligations, such as timely filing of returns and tax payments. Professional Tax Registration guarantees that individuals and companies complete their tax duties, thereby contributing to the smooth operation of local governance and development projects.

Benefits of Registering as a Professional Tax Registration

Individuals and corporations alike can benefit from Professional Tax registration. For starters, it ensures compliance with state legislation, avoiding legal consequences and penalties. The registration process promotes the systematic collection of taxes from professionals and aids in the development of state revenues.

Furthermore, a Professional Tax Registration certificate is frequently required for getting numerous licenses and permits, increasing the legitimacy of organizations. Furthermore, registered persons are eligible for tax breaks under the Income Tax Act.

Employees benefit from having professional tax deducted at the source since it streamlines tax payment and ensures timely and hassle-free compliance. All things considered, professional tax registration not only satisfies legal requirements but also helps with effective tax administration, facilitating corporate operations and encouraging financial accountability.

Why We Need to Register as a Private Limited Company?

For business owners and entrepreneurs, registering a private limited company has several important benefits. First of all, it offers a strong framework for limited liability that shields private assets from obligations incurred by the corporation.

Customers, partners, and investors will feel more confident with this legal structure's increased legitimacy. A Private Limited Company can engage into agreements, buy assets, and withstand ownership changes with ease because it is a distinct legal entity.
Moreover, it provides permanent succession, guaranteeing corporate continuity even in the event of leadership changes. Registering additionally offers access to financial opportunities, including the issuance of shares and simpler financing.

Registering a Private Limited Company creates a reliable, acknowledged, and adaptable base that encourages the expansion and long-term sustainability of enterprises.

For business owners and entrepreneurs, registering a private limited company has several important benefits. First of all, it offers a strong framework for limited liability that shields private assets from obligations incurred by the corporation.

Customers, partners, and investors will feel more confident with this legal structure's increased legitimacy. A Private Limited Company can engage into agreements, buy assets, and withstand ownership changes with ease because it is a distinct legal entity.

Documents Required for Professional Tax Registration

Application Form:
  • Obtain and complete the prescribed application form for professional tax registration.
Proof of Business Existence:
  • Certificate of Incorporation (businesses only)
  • Partnership Agreement (for joint ventures)
  • Articles of Association and Memorandum of Association (for corporations)
Address Proof:
  • Lease or rental agreement for the business premises Property tax receipt or evidence of ownership
PAN Card:
  • A copy of the business entity's Permanent Account Number (PAN) card.
Identity Proof:
  • Copies of the firm owners' or partners' identity documents (e.g., Aadhar card, passport, voter ID)
Registration Certificate:
  • Certificate of registration obtained from the Registrar of Companies (RoC) or other appropriate authority
Employee List:
  • Personal information about employees, such as names, addresses, and PAN numbers
Payment of Professional Tax:
  • Challans or proof of payment of the appropriate professional tax
Authorization Letter:
  • Provide an authorization letter if the application is being submitted by someone other than the business owner.
Other Documents:
  • A copy of the business entity's Permanent Account Number (PAN) card.

Checklist for Private Limited Company Registration

Start your Private Limited Company (Pvt Ltd) Registration process online at the Reasonable Price.
Unique Name
The business name should be distinctive both phonetically and spelling-wise. 
It should not be identical to any registered or pending trademark.
Ensure it doesn't infringe the Copyrights Act, Indian Trade Mark Laws, or violate any other intellectual property laws in India.
Minimum 2 Directors
Private Limited Company Registration requires a minimum of two shareholders and two directors.
Foreign shareholders' documentation needs to be notarized and apostilled.
During incorporation, only 3 Directors without a DIN (Director Identification Number) are authorized. Post-incorporation, up to 15 more directors may be appointed.
Registered Office Address
If incorporating in a rented property, obtain landlord permission, a No Objection Letter, and a business-named rental agreement.
The new firm must lease property from directors and shareholders.
Be aware that state stamp duty can impact incorporation fees
Capital Requirement
Clearly understand the capital requirement for your business.
Determine the capital structure, including the number and types of shares (e.g., ordinary shares, preference shares) to be issued.
Business Objective of the Company
Maintain a strong financial position by managing cash flow effectively, controlling debt, and making prudent financial decisions.
Obtain DIN for directors and DSC for digital authentication of documents.
Draft the MOA and AOA, which outline the company's objectives, rules, and regulations. These documents are essential for private limited company registration.

Eligible Criteria for Professional Tax Registration

Professional Tax (PT) registration is normally necessary for individuals or companies engaged in professions, trades, or employment. Professional taxation in India is a state-level tax, hence the requirements for registration can differ from state to state. In general, the following entities or people are eligible for professional tax registration:
  • People with Salaries:
    Employees who receive a salary or wage are normally required to register for professional tax.
  • Employers:
    It is mandatory for employers to register and deduct professional tax from their employees' salary.
  • Self-employed People:
    Professionals, freelancers, consultants, and self-employed individuals working in numerous crafts and professions are frequently obliged to register for professional tax.
  • Business owners:
    Professional tax registration may be required for sole proprietorships, partnerships, and corporations engaged in business activities.
  • Professionals:
    Professional tax registration may be available to individuals who work in particular professions, such as doctors, lawyers, chartered accountants, architects, and so on.
  • Manufacturers and Traders:
    Professional tax registration may be required for traders, manufacturers, and other commercial enterprises.
  • Contractors:
    Individuals or businesses who perform contracting work may be required to register for professional tax.
  • Directors:
    Directors of corporations, whether executive or non-executive, may be subject to professional taxation.

Professional Tax in Tamil Nadu

Professional tax is currently charged on employed or self-employed individuals in 17 Indian states, with Tamil Nadu being one among them. This tax generates significant revenue for the state and applies not only to employees but also to those engaged in a variety of trades, professions, and occupations.
Calculation and Restrictions:
  • The amount of professional tax in Tamil Nadu is income-dependent. Employees have it removed from their pay monthly, whilst directors, partners, enterprises, and self-employed individuals have it deducted from the previous year's gross turnover. According to Article 276 of the Indian Constitution, the total professional tax should not exceed Rs 2500.
Legal Framework:
  • The professional tax in Tamil Nadu is governed by the Tamil Nadu Panchayats, Municipalities, and Municipal Corporations Rules, 1998. This ordinance, which was enacted on October 1, 1998, applies to towns, panchayats, municipalities, and municipal corporations throughout the state.
Applicability:
  • Professional tax in Tamil Nadu is applicable to self-employed individuals and salaried workers, pursuant to Section 138C of the Tamil Nadu Municipal Laws Second Amendment Act 59 of 1998, where employers pay the tax on behalf of their employees. Private establishments, Hindu Undivided Families (HUFs), companies, firms, corporations, societies, clubs, and associations are also required to pay this tax.
Tax Slabs:

In Tamil Nadu, the amount of professional tax due is determined by the average monthly income of people or businesses. The following are the tax slabs:

  • Up to Rs 21,000: Nil
  • Rs 21,001 to Rs 30,000: Rs 130
  • Rs 21,001 to Rs 30,000: Rs 130
  • Rs 45,001 to Rs 60,000: Rs 690
  • Rs 60,001 to Rs 75,000: Rs 1025
  • Above Rs 75,000: Rs 1250
Online Payment:
  • Salaried persons and employers can pay professional tax online through the Greater Chennai Corporation's official website. Selecting 'Online Payment,' then 'Professional tax payment,' and then following on-screen directions to complete the transaction via debit card, credit card, or net banking is the procedure.
Exemptions:
  • Senior citizens over the age of 65, parents of children with mental disabilities, individuals with permanent physical disabilities, foreign employees, women agents under specific schemes and military personnel serving in the Air Force, Navy, and Army, as well as reservists working for the state or auxiliary forces, are exempt from professional tax payment in Tamil Nadu.

Filings for Professional Tax Registration

Determine Applicability:
  • Determine whether your company or you as a person are required to pay professional tax under the rules and regulations of the relevant state.
Document Preparation:
  • Collect the required paperwork, which can include copies of your PAN card.
  • Provide proof of address (utility bills, leasing agreement, etc.).
  • Documents for business incorporation (Certificate sof Incorporation, Partnership Deed, and so on).
  • Employees' names, contact information, and PAN cards are all listed.
  • Bank account information.
  • Other documents as specified by state authorities.
Obtain an Application Form:
  • Obtain the appropriate professional tax registration application form from the local authorities or the state's official website.
Complete the Application Form:
  • Fill out the application form with current and accurate information. Make sure to include all necessary information, such as your company's name, employees' names, and financial information.
Visit the local tax office:
  • Visit your state's professional tax office or the relevant authority's office.
  • Submit the completed application form with all required supporting documentation.
Verification and approval:
  • The tax authorities will analyze your application and papers.
  • They will evaluate the facts and authorize your professional tax registration if everything is in order.
Receipt of Certificate:
  • You will be issued a Professional Tax Registration Certificate once your application has been approved. This certificate confirms that you are officially enrolled to pay professional tax.
Tax Deduction Begins:
  • Start deducting professional tax from your employees' salary at the applicable rates if you are an employer.
Filing Regular Returns:
  • Following registration, you may be required to file periodical returns, which are normally due monthly or annually, depending on the state. Maintaining compliance requires timely and accurate filing.

ComplianceCompliance for Professional tax registration

1.Tax Liability:

Ensure timely and proper payment of professional tax based on applicable slabs and rates.Ensure that relevant deductions are made from employee wages or the turnover of self- employed individuals.

2. Return Submission:

Regularly file professional tax returns within the required deadlines, providing accurate information about income and other relevant elements.

3. Record Keeping:

Keep detailed records of professional tax payments, returns, and any other necessary documentation.

4. Legal Framework Compliance:

Stay up to date on changes to professional tax rules and regulations to ensure continuing compliance.

ComplianceNoncompliance Penalties:

1. On-Time Payments:

Late payments may incur penalties. To prevent additional charges, be sure that all payments are paid within the time frame specified.

2. Noncompliance with Closure Procedures:

Failure to follow the authorized closure procedures may result in future penalties or problems.

Closure for Professional Tax Registration

1. Cessation of Business Operations:

If the business or profession is no longer in operation, notify the tax authorities.

2. Termination of Employees:

Employers must update records and notify the tax authorities when an employee leaves or the business is closed.

3. Clearing Dues:

Before advancing with the closing process, settle any outstanding professional tax dues.

4. Documentation:

To speed up the closing process, collect all required paperwork, such as certifications, returns, and evidence of payment.

5. Formal Closure Request:

Submit a formal request to the competent tax authorities for the closure of the professional tax registration. This could entail completing a specific form or submitting a written request.

6. Verification and Approval:

Tax authorities can conduct a verification process to ensure that all dues are paid and compliance criteria are met. They will approve the closure if they have been satisfied.

7. Cancellation Certificate:

Obtain a cancellation certificate or acknowledgment from the tax authorities verifying the closure of the professional tax registration.

8. Employee Communication:

If applicable, notify employees of the closure of professional tax registration and any modifications to the deduction process.

Compliance for Private Limited Company

1. Board Meetings and Annual General Meetings:
As part of their compliance requirements, private limited firms must hold board meetings and an annual general meeting (AGM). There must be a record of these meetings' minutes.
2. Certificates of Compliance:
These documents attest to an organization's compliance with a number of legal criteria and may be imposed of companies.
3. Modifications to the Company Structure:
Regulatory organizations should be notified of any modifications to the company's structure, including changes to the registered office address, share capital, or directors.
4. Event-Based Filings:
When a significant event occurs, like a name change or a modification to the articles of association, a corporation may be required to file an event-based report.

Why SHR for Your Professional Tax Registration?

Cutting-Edge Updates:
Stay ahead with SHR's quick and guaranteed updates, which provide a constant connection to essential data for a competitive advantage.
Document Fortification:
Trust SHR to strengthen your documents, prioritizing data security with strong encryption and safe storage to ensure confidentiality.
Financial Wellness Priority:
SHR prioritizes your financial well-being, providing cost-effective services that save you money while meeting your needs, and promoting value without compromise.
Streamlined Efficiency:
SHR's simple and efficient services provide a smooth experience, from quick processes to timely responses. We are dedicated to saving you time so you can focus on your objectives.

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