Bihar professional tax: Tax slab, payment, registration, and more

In this article, we will learn the definition, registration process, applicability, tax slab rates, deduction cycles, tax filing cycle, steps to pay professional tax online, and penalty for late payment regarding the professional tax in Bihar. For business owners and employers, this can be a one stop guide for understanding professional tax in depth.

Professional tax in Bihar

The Bihar Professional Tax is a tax collected by the state government from people and businesses in Bihar who work in different professions and trades. Its main purpose is to generate revenue for the state government. This tax is similar to the income tax imposed by the Central Government, but it focuses specifically on professional activities. This means you need to pay a certain percentage of your income to the Commercial Tax Department of your state as professional tax.

The Bihar Professional Tax Rules, 2011

If you have a job or are part of a business in Bihar, the state government will take a small portion of your income as a professional tax. This happens in most states in India when you earn at least Rs. 3,00,000 per year. In Bihar, the State Municipal Corporation is responsible for collecting this tax based on how much you earn. The good news is you can reduce the amount of tax you pay on your overall income by deducting the professional tax you have paid. This deduction is allowed under Section 16 of the Income Tax Act.

Applicability of professional tax in Bihar

• Individuals: Any individual who is engaged in any profession, trade, calling, or employment, including salaried employees, self-employed professionals, freelancers, and contract workers, is generally required to pay the professional tax.

• Businesses: Any company, firm, or organization operating within Bihar that employs individuals in various professions, trades, callings, or employments is also liable to pay the professional tax on behalf of its employees.

• Employer: Employers are responsible for deducting professional tax from the salaries or wages of their employees and remitting it to the appropriate state government authority.

• Employee: Individuals who are employed in various professions, trades, callings, or employments in Bihar are responsible for paying professional tax.

• Self-employed individuals: Individuals who are self-employed and engaged in different professions, trades, or callings in Bihar are also responsible for paying professional tax.

Steps and forms required for registering for professional tax in Bihar

The Bihar State Government does not collect application or processing fees, and does not require a security deposit for registering Bihar Professional Tax. To complete the registration, you need to fill in Form I. Refer to the "Compliance forms for Bihar professional tax" table below for reference.

Once you submit the application online, the concerned authority, including the Deputy Commissioner, Assistant Commissioner, or Commercial Tax Officer, will verify the form and provide you with the certified copy of the professional tax registration within 15 days from the date of application. Here are the steps involved:

1. Visit the official website of the Commercial Tax Department of the Bihar government.

2. Click on the e-Registration option under the e-Services tab on the home page.

3. Choose the "professional category tax" option on the next page.

4. Fill in all the required information and upload the necessary documents on the online registration page. Then, click Add.

5. A pop-up window will appear. Click Submit.

6. Confirm your submission by clicking OK. You will receive an acknowledgment receipt.

7. The concerned office will review your registration and notify you further through SMS and e-mail.

8. To check the status of your registration, select the registration type and enter the acknowledgment/application number.

Source: https://www.biharcommercialtax.gov.in/bweb/download/Help/SignUpHelp.pdf

Professional tax slab rate in Bihar

Professional tax slab rates for all categories of profession in Bihar

Source: https://www.datocms-assets.com/40521/1615372477-bihar-pt-schedule.pdf

Bihar professional tax online payment

1. Visit the official website of the Commercial Taxes Department of the Government of Bihar.

2. If you haven't registered before, refer to the "Steps for registering with professional tax" section in this article and follow the instructions.

3. Find the "Payment for professional tax" section.

4. Validate your credentials by entering your PAN (Permanent Account Number) and the name on your PAN Card. Also, enter the CAPTCHA code provided.

5. You will be redirected to a form where you need to provide details such as division, circle name, address, type of payment, financial year, tax period, and payment mode.

6. Enter the amount of tax you need to pay by checking the payment box associated with your account ID. If there are any penalties mentioned in the notice you received, include the penalty amount as well.

7. Click on "Submit" to complete the payment process.

8. Once the payment is successfully processed, you will receive a downloadable payment receipt.

Due date for deducting and filing professional tax returns in Bihar

After you find out how much you need to pay and how to submit the tax return, make sure you pay the tax on time. In Bihar, the professional tax must be paid by November 15. Every year, you should follow this same due date and submit your return by November 30 to avoid penalties.

Bihar professional tax late payment penalty

If someone breaks any rule mentioned here, they can be fined up to five hundred rupees. If the violation continues, they can be fined an additional ten rupees for each day the violation persists.

Bihar professional tax exemption

• Individuals below a certain income threshold: Individuals whose income falls below a specified threshold may be exempted from paying professional tax.

• Senior citizens: Senior citizens who have attained a certain age may be exempted from paying professional tax.

• Persons with disabilities: Individuals with certain disabilities may be exempted from paying professional tax.

• Government employees: Government employees, including those working for the state or central government, may be exempted from paying professional tax as per the specific provisions and rules applicable to them.

• Armed forces personnel: Members of the armed forces, such as the army, navy, or air force, may be exempted from paying professional tax.

Compliance forms for Bihar professional tax

Source: https://www.datocms-assets.com/40521/1615372483-bihar-pt-rules.pdf