1 21 August, 2013 C. No. General Dear Sir, The State Government has sought the Chamber s views on Profession Tax. Please find enclosed the attached note on WEST BENGAL PROFESSION TAX MADE EASY, as shared by the MSME Conclave Secretariat with us. Your feedback on the Note is required. Kindly mail us your feedback at or or fax at Your prompt response will be greatly appreciated. Thanking you, Regards Tuli Sengupta Roy Assistant Secretary
2 WEST BENGAL PROFESSION TAX MADE EASY INTRODUCTION Profession Tax is a tax levied on a person engaged in any profession, trade, calling and employment in West Bengal. The West Bengal State Legislature enacted The West Bengal State Tax on Professions, Trades, Callings and Employments Act,1979 in exercise of the power conferred by the Article 276 of the Constitution of India under Entry No. 60 of the State List relating to taxes on professions, trades, callings and employments. The Act came into effect on and from Those who are liable to pay Profession Tax under the act may be divided into two categories : i) Persons* engaged in professions, trades, callings and employments ii) Employer** (Government, Public and Private Sectors) Person means any person who is engaged in any profession, trade and calling or employment in West Bengal and include (i) a Hindu Undivided Family, Firm, Company, Corporation or other Corporate body, any Society, Club or Association; & (ii) every branch or office of such firm, company, corporation or other corporate body, any society, club or association, so engaged, but does not include any person who earns wages on a casual basis on being employed for a period not exceeding 180 days in a year. Employer means the person or the officer who is responsible for disbursement of salary or wages, and includes the head of the office or any establishment as well as the manager or agent of the employer. * A Person requires Certificate of Enrolment, Payment of Tax but no filing of Return ** An Employer requires Certificate of Registration, Payment of Tax and filing of Return ENROLMENT Every person who is covered by entry no.2 to 23 of the Schedule appended to the Act is required to obtain an Enrolment Certificate within 90 days from the date of liability to pay tax. A person liable to pay tax shall apply in Form-II to the Deputy Commissioner / Profession Tax Officer having jurisdiction, for enrolment along with the under noted documents : i) Copy of challan as proof of up-to-date payment of profession tax (with interest, if any) ii) Documents relating to Commencement of Business, Identity proof, Income Tax PAN card etc. Any person can also apply for enrolment in the Spot Enrolment Cell, located at Sales Tax Building (2 nd building, 2 nd floor); 14, Beliaghata Road, Kolkata Here the Certificate of enrolment is issued on the same day. Again, application can also be made for enrolment online though Where an applicant has more than one branch or office or place of work in West Bengal, he may, at his option, make a single application (in Form-II, along with the declaration appended in Annexure to Form-II) and submit the same to the concerned Joint Commissioner / Deputy Commissioner / Profession Tax Officer in whose jurisdiction his principal place of business is situated
3 In case a person is covered by more than one entry of the Schedule, the highest rate of tax specified under those entries will be applicable. If a person willfully fails to apply for enrolment within 90 days from the date of liability, penalty of Rs.100 for delay of each English calendar month or part thereof may be imposed. In addition to this, there remains the provision of punishment with simple imprisonment with or without fine for the said default DETERMINATION OF TAX If an enrolled person fails to pay due tax or pay less than the amount actually payable by him, the concerned Deputy Commissioner / Profession Tax Officer is to determine the tax payable by him after service of notice in Form-X. If any person fails to get himself enrolled even after being liable to pay tax, the concerned Deputy Commissioner / Profession Tax Officer is to determine the tax payable by him after service of notice in Form-XII. However, with effect from , determination of tax of both un-enrolled and enrolled persons is limited to three years from the end of any year or period for which such determination is to be made. REGISTRATION Every employer is liable to deduct profession tax from the salary or wages payable to his employee(s), as per the slab mentioned in Serial No.1 of the Schedule Such employer (not being an officer of Government) is required to apply and secure a Certificate of Registration. An application for registration is to be made in Form-I to the Deputy Commissioner / Profession Tax Officer having jurisdiction, for registration. The application is to be made within 90 days from the date of liability. An employer having more than one place of work within the jurisdiction of different authorities shall make separate application for registration to each of such authorities. However, the Commissioner of Profession Tax may allow an application for single Registration for the whole of West Bengal. If an employer willfully fails to apply for registration within 90 days from the date of liability, penalty of Rs 500 for delay of each English calendar month or part thereof may be imposed. In addition to this, failure to apply for registration is an offence punishable with simple imprisonment with or without fine. SALARY AND WAGES Salary and wages shall include - Pay, Dearness Allowance and any other amount paid by way of allowance, all remunerations received on regular basis whether payable in cash or kind; honorarium, perquisites and profit in lieu of salary as defined in Section-17 of the Income Tax Act, 1961; encashment of leave amount (excluding payable on retirement or on death of the employee); subsistence allowance, leave concessional pay. Salary and Wage shall not include : Medical reimbursement, traveling allowance, reimbursement of conveyance charges, stipend paid to trainee, salary paid to apprentice under Apprentices Act, leave travel assistance payment, statutory Bonus, gratuity, lay of compensation and ex-gratia payment.
4 Pension granted to an employee is not salary and hence pensioner are not liable to pay Profession Tax on pension. PAYMENTS Profession Tax can be paid online through GRIPS by logging in https://wbfin.wb.nic.in/grips or though It can also be paid through challan in specified branches of the Reserve Bank of India, State Bank of India and its Associate Banks, all Nationalized Banks, IDBI Bank, ICICI Bank, Axis Bank and HDFC Bank. Profession Tax is required to be paid by the enrolled persons on or before 31 st July of each financial year. For registered employers, profession tax is required to be paid monthly. If an employer or an enrolled / un-enrolled person fails to pay tax, within the due time, he shall be liable to pay a simple 1% per month or part thereof, on due tax. RETURN All Registered employers are required to submit returns electronically by logging in to The hard copy of the return, as electronically transmitted, along with the acknowledgement and tax paid challan(s) are also required to be furnished within 15 days of the following month to the prescribed authority. The return period is normally Annual. However, if the total tax paid by a Registered Employer was Rs 30,000/- or more in the previous year, the registered employer will be required to file return quarterly from the next financial year. Tax Liability Return Periodicity Due Date of Online Submission of Return Less than Rs 30,000 in previous year Rs 30,000/- or more in previous year Annual Quarterly 30th April Last day of July, October and December and April Commissioner of Profession Tax or Additional Commissioner of Profession Tax may accord permission, on the application of a registered employer having more than one place of work under the jurisdiction of different authorities, for furnishing a consolidated return (against the registration of principal place of business & subject to cancellation of Registration No. of all other places of business, if any) and to pay tax centrally (in respect of all such places of work) from his principal place of business. A Registered Employer can file revised return, to rectify any mistake or omission, within the due date of filing the next return. For late filing of Return, late fee is Rs 200/- for the first month of default and Rs 100/- for each subsequent month or part there-of. Non-submission of return is an offence punishable with simple imprisonment with or without fine. In addition to this, such return defaulters will be subject to compulsory assessment and penalty. No return is required to be filed by an enrolled person.
5 ASSESSMENT There exists provisions for assessment (of tax etc) in the following cases:- (i) If an employer fails to get himself registered; (ii) If a registered employer fails to furnish return(s); (iii) If the Prescribed Authority is not satisfied that the return filed by a registered employer is correct and complete. Summary Assessment :- If a registered employer submits the quarterly / annual return (as the case may be) which is complete and self consistent and the amount of tax, interest & late fee (if any) is paid in full according to such return, the return so furnished shall be Summarily Assessed on the date of submission of such return. Introduction of Audit :- The concept of Audit has been introduced in the Profession Tax to check the veracity of return(s) of certain numbers of dealers / tax payers. APPEAL / REVISION An appeal shall lie to the Joint Commissioner against an order of assessment of the Deputy Commissioner / Profession Tax Officer. For an appellate order passed by the Joint Commissioner, revision shall lie to the Senior Joint Commissioner of Profession Tax. For any order other than the assessment order, revision shall lie in the same manner. Memorandum of appeal or application for revision is to be made in duplicate in Form-XIV, within 60 days from the date of receipt of the order. 3% of the tax, penalty and interest in dispute involved in the appeal / revision (subject to a minimum of Rs and maximum of Rs ), shall be paid as prescribed fees for this purpose. AMENDMENTS, CANCELLATION, DUPLICATE EC / RC There are the provisions :- (i) to amend the certificate of Enrolment / Registration in respect of any change of constitution, nature of activity, address etc; (ii) to cancel the Certificate of Enrolment in case of cessation of profession or death of a person. Certificate of Registration can be cancelled in the case of cessation of liability; (iii) to issue duplicate certificate of Enrolment / Registration if it is lost, destroyed or defaced. Amnesty Scheme An employer or a person, who is liable to pay tax under the act but has failed to apply for registration or enrolment or both may exercise an option to apply for registration or enrolment or both along with a declaration by employer or person in a prescribed form within the 31st Day of January, 2014 and with tax receipted challan of Rs.2500/- p.a. for maximum period of 2(two) years (i.e. for & ) by a person or Rs.200/- p.m. per employee for maximum period of 2(two) years (i.e. for & ) by an employer within 31st January, The defaulting registered employers may opt to furnish the due return(s) for the periods F.Y and , without payment of late fee and interest, within 31st January, EXEMPTION The State Government may make an exemption or reduction in the rate of tax payable by any class of persons by issuing notifications. At present the members of the forces as defined in the Army Act, 1950, the Air Force act, 1950, and the members of Indian Navy as defined in the Navy Act, 1957 serving in any part of West Bengal and drawing pay & allowances as Army or Air Force or Navy, as the case may be, including the members of auxiliary forces or reservists, or reserve and auxiliary services serving in any part of West Bengal and drawing pay and allowances as such auxiliary forces or reservists, or reserve and auxiliary services, as the case
6 may be, under the budgetary allocations of the defence services, are exempted from payment of Profession Tax w.e.f NOTE For details : Please consult the West Bengal State Tax on Professions, Trades, Callings and Employments Act 1979 & the West Bengal State Tax on Professions, Trades, Callings and Employments Rules 1979 which are available in our official website: > Acts & Rules CONTACT INFORMATION Additional Commissioner, Profession Tax: (033) , ( Extension 216 ) Senior Joint Commissioner, Profession Tax: (033) , ( Extension 380) Public Information officer, profession tax: (033) , ( Extension 204 ) Website: