Professional Tax in Andhra Pradesh

The Andhra Pradesh state government imposes professional tax on individuals when people involved in different types of work, trades, or jobs are considered. The Commercial Tax Department regulates the professional tax in Andhra Pradesh, which is to be paid by individuals who receive a yearly salary.

The professional tax applies to professionals as well as salaried and self-employed individuals. However, these groups differ in how the tax is calculated and paid. This tax plays a vital role in the development and welfare of Andhra Pradesh. Complying with the tax requirements is crucial for businesses and individuals to ensure there are no penalties.

Applicability of Professional Tax in Andhra Pradesh

In Andhra Pradesh, professional tax is mandatory for many individuals, including salaried employees, self-employed professionals, and business owners. Municipal corporations collect the tax based on earnings from salaries, wages, or commissions.

The usual tax rate is Rs. 200 monthly or Rs. 2400 annually. Specific groups, however, qualify for exemptions that relieve them from this tax.

Table of Exemptions in Andhra Pradesh Professional Tax

Sr No. Exempted Group Description
1 Government Employees Exempt From Professional Tax
2 Ex-servicemen and Dependents Exempt From Professional Tax
3 Persons With Disabilities (PWD) Exempt From Professional Tax
4 Employees Earning Less Than ₹15,000 per Month Exempt From Professional Tax
5 Agricultural Workers Exempt From Professional Tax
6 Handicraft Workers Exempt From Professional Tax
7 Poultry, Sericulture, and Beekeeping Workers Exempt From Professional Tax
8 Unorganized Sector Workers Exempt From Professional Tax
9 Small-Scale Industry Workers Exempt From Professional Tax
10 Employees in Government-Recognized Organizations Exempt From Professional Tax

These exemptions support economic diversity and aid specific groups financially.

Professional Tax Slab Rates in Andhra Pradesh

Professional tax in Andhra Pradesh applies to various salary brackets. This system is designed to be progressive and ensure fairness. Below is a table outlining the slab rates based on monthly income levels.

Table of Andhra Pradesh Professional Tax Slab Rates for Employees

Sr No. Monthly Income (INR) Tax Rate (INR per Month)
1 Up to 15,000 0
2 From 15,001 to 20,000 150
3 Above 20,000 200

These rates apply to salary and wage earners within the state. This ensures that individuals contribute according to their earning capacity.

Andhra Pradesh Professional Tax Online Payment

Paying professional tax in Andhra Pradesh involves two distinct forms: Form I and Form II. Each form has its process on the Commercial Taxes Department’s official website.

Form I Return (Monthly Tax Return)

  1. Navigate to ‘Make Payment’ on the website.
  2. Choose ‘Online Payment’ and proceed through your preferred payment gateway.
  3. After payment, a confirmation message displays, which you can print for records.

Form II Return (Annual Tax Return)

This can be done via Direct Payment or After Login

Direct Payment Method

  1. Go to ‘My Profession Tax’ and select ‘e-payment’.
  2. Enter your Form II PTIN and captcha to receive an OTP.
  3. Enter the OTP, select the financial year, and complete the payment.

After Login Method

  1. Access ‘My Profession Tax’ then ‘Taxpayer Login’.
  2. Navigate to ‘Dashboard’, then ‘Returns’, and select Form II payment.
  3. Choose ‘Financial year’, click ‘Make Payment’, and proceed online.
  4. Upon completion, a screen message will appear for printout.

These processes ensure smooth and documented tax payments.

Penalty for Not Paying Professional Tax in Andhra Pradesh

Failing to pay professional tax in Andhra Pradesh results in accruing interest and substantial penalties. Interest is charged at 1.5% per month on the unpaid tax amount. Penalties start at Rs 500 for each month delayed, up to a maximum of Rs 10,000.

For non-payment that extends beyond six months, more severe consequences follow. The state can prosecute under Section 40 of the Andhra Pradesh Professional Tax Act 1987. Continued non-payment may cancel the taxpayer’s registration if not settled within six months of the due date.

In severe default cases, the assessing authority is empowered to seize or attach the taxpayer’s property to recover due amounts. It also includes movable and immovable assets. Taxpayers may also incur additional costs, such as legal fees and court expenses.

Timely payment is crucial to avoid these penalties, legal consequences, and potential disruptions.

Wrapping It Up

HR professionals should stay informed about professional tax in Andhra Pradesh to ensure compliance. Understanding the implications of non-compliance and the associated penalties is crucial.

Regular updates and training sessions help maintain staff awareness. This tax affects all salary brackets, requiring diligent management and timely payment. Monitoring tax payment deadlines and ensuring all employees are correctly assessed can prevent legal issues.

Efficient handling of these responsibilities showcases the competence and reliability of the HR department in managing essential tasks.

FAQs About Professional Tax in Andhra Pradesh

What is the Professional Tax in Andhra Pradesh?

Professional tax is a state-level tax imposed on professions, trades, and employment, collected monthly or annually based on income slabs.

Are There Any Exemptions From the Andhra Pradesh Professional Tax?

Yes, government employees, people with disabilities, and those earning below a certain threshold are exempt from paying professional tax.

How Is Professional Tax Paid in Andhra Pradesh?

Tax can be paid online through the Commercial Taxes Department website using Form I for monthly returns or Form II for annual settlements.

How Much Is the Professional Tax in Andhra Pradesh?

The professional tax payable depends on an individual’s or entity’s income slab. In Andhra Pradesh, the minimum tax rate is Rs 150 per month and can be as high as Rs 2500 per month.

What Are the Penalties for Late Payment of Professional Tax in Andhra Pradesh?

Late payments attract a penalty ranging from 25% to 50% of the tax due, plus interest at 1.5% per month.

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