The Madhya Pradesh State Tax on Professions, Trades, Callings and Employment Act, 1995 (commonly know as Profession Tax Act) with the object of levying tax on professions, trades, callings and employments. This Act may be called the Madhya Pradesh Vritti Kar Adhiniyam, 1995. It extends to the whole of Madhya Pradesh. It shall be deemed to have come into force on the 1st day of April, 1995.
Under the Madhya Pradesh Vritti Kar Adhiniyam (Professional Tax Act), 1995, employers have specific obligations regarding the deduction and remittance of professional tax for their employees. These responsibilities include:
Employers must obtain a Certificate of Registration from the Profession Tax Assessing Authority. This certificate authorizes them to deduct professional tax from their employees' salaries or wages.
Employers are required to deduct the applicable professional tax from their employees' salaries or wages on a monthly basis, in accordance with the prescribed tax slabs. Persons in Employment
Annual Salary/Wages and Professional Tax Liability:
Persons in Employment
Up to ₹2,25,000 ---------------- Nil (No tax liability). ₹2,25,001 - ₹3,00,000 ---------- ₹1,500 annually (₹125 per month). ₹3,00,001 - ₹4,00,000 ---------- ₹2,000 annually (₹166 per month for 11 months and ₹174 in the 12th month). Above ₹4,00,000 ---------------- ₹2,500 annually (₹208 per month for 11 months and ₹212 in the 12th month).
Special Note: If an individual ceases employment during the year, the tax liability will be proportionately reduced.
Yearly Salary Range -------------- PT/Year Up to Rs.2,25,000 ------------------- 0 Rs.2,25,001 - Rs. 3,00,000 ---------- Rs.1,500 Rs. 3,00,001 - Rs.4,00,000 ---------- Rs.2,500 Rs.4,00,001 and above --------------- Rs.2500
The deducted tax must be remitted to the state government within the stipulated time frame. Typically, this involves depositing the tax amount within 10 days after the end of the month in which the deduction was made.
Employers are obligated to file periodic returns in the prescribed format, detailing the salaries paid and the corresponding tax deducted. These returns should be accompanied by proof of tax payment, such as a treasury challan. Failure to include proof of payment renders the return invalid.
Employers must maintain accurate records of salary payments and tax deductions for all employees. These records should be readily available for inspection by the tax authorities.
Employers must maintain accurate records of salary payments and tax deductions for all employees. These records should be readily available for inspection by the tax authorities.
Employers are required to comply promptly with any notices or directives issued by the Profession Tax Assessing Authority.
Non-compliance with these obligations can result in penalties, including fines for delayed registration, late payment, or failure to file returns.