Professional tax in Odisha: Slab, registration, and payment steps

Professional tax is a form of tax imposed by the government on individuals who earn a salary or income from a profession or trade. It is levied by state governments, and the amount of tax to be paid varies from one state to another in India. The revenue generated from professional tax is utilised by the state government for various welfare and development activities. In the state of Odisha, the professional tax process is governed by the Odisha State Tax on Professions, Trades, Callings, and Employments Act, 2000.

This article provides a complete guide to understanding professional tax in Odisha. It covers who needs to pay, the rules and regulations, different payment methods, and helps you keep your business compliant with the act.

Professional tax rules in Odisha

As per the Odisha Professional Tax rules, individuals engaged in various professions, including salaried employees, self-employed professionals, and business owners, are liable to pay professional tax. The tax rates and slabs are determined by the Odisha government and vary based on the income earned.

For salaried employees, the tax is deducted by employers from the salaries and remitted to the state government on a monthly basis.

For self-employed individuals and business owners, the onus is on them to deduct the correct tax amounts and deposit it to the government. Non-compliance with the professional tax rules can result in penalties or legal consequences.

Applicability of professional tax in Odisha

The following individuals and entities are liable to pay professional tax in Odisha.

1. Salaried individuals: Employees working in private companies, as well as those employed by the state or central government, such as ministers or members of the legislative assembly.
2. Self-employed individuals: Freelancers and people involved in any kind of profession or trade, except for those who earn wages on a casual basis.
3. Entities: Hindu Undivided Families, societies, clubs, or associations engaged in any profession.
4. Businesses: Firms, companies, or corporate bodies operating within the state of Odisha.
5. Employers: Individuals who are responsible for paying salaries to employees within an organization, including business owners, managers, and other stakeholders, must deduct the correct amount of tax from their employees' salaries and submit it on their behalf.

Odisha professional tax slab rates

Registering for professional tax in Odisha

All employers and self-employed individuals in Odisha who are required to pay professional tax must apply for a registration certificate within 30 days of becoming liable for the tax.

To register for professional tax, you can use the single-window portal called GO SWIFT, which is run by the Government of Odisha.

Step-by-step guide to registering for professional tax online in Odisha

To complete the registration process, you must first create an account on the official portal. Once you have created an account, log in to proceed with the professional tax registration. Here are the step-by-step instructions to guide you through the process.

Odisha professional tax payment process

1. Visit the official Odisha Treasury portal for professional tax payment.
2. From the Online Challan Submission section, select Commercial Tax.
   
   
    
3. On the subsequent E-challan page, choose Professional Tax from the list of Challan Purposes.
4. Fill in the Dealer Details form with your name, registration number, and address.
5. Scroll down and provide the payment details, including the payment period and mode of payment.
6. Click Next. The system will automatically calculate the tax amount, verify it, and proceed with the payment.
7. On the payment gateway page, enter the OTP verification code sent to your mobile number.
8. After a successful payment, a return receipt will be generated. Download the receipt for future reference

Last date to pay professional tax in Odisha

All registered employers must pay the full amount of tax they owe to the Government Treasury every month. The payment deadline is the last day of the following month. For example, if an employer deducts professional tax from an employee's salary in May, the deducted amount should be deposited to the government before the end of June.

Penalty for late payment and other offences

If individuals or employers fail to comply with the provisions of the Odisha Professional Tax Act, various penalties can be imposed.

The penalties mentioned above are in addition to any applicable interest charges.

Compliance forms and challans for professional tax in Odisha