PROFESSION TAX IN KARNATAKA
The profession tax in Karnataka is levied through the ‘Karnataka Tax on Professions, Trades, Callings and Employments Act 1976’, in the state of Karnataka. All taxes levied under the said Act are known as profession tax. The state of Karnataka is empowered to levy and collect the tax on professions, trades, callings and employment. Every person who exercise any profession or calling or is engaged in any trade or holds any appointments (public or private) is liable to pay the profession tax.
People who have attained 65 years of age are exempted from paying profession tax. If the person exercise a profession for a period less than 120 days in an year, then he is not liable to pay profession tax in that year. The liability is on the employer to deduct the tax from the salary or wage of the employ and to pay the tax to the Government.
Every employer who is liable to profession tax shall obtain a certificate of registration from the assessing authority.
Every employer shall furnish to the assessing authority, within 20 days of the expiry of a month, a statement showing the salary and wages of his employees and the profession tax deducted by him during the preceding month. Every such statement shall be accompanied by a treasury challan, in proof of the payment of the full amount of tax due mentioned in the statement.
Every employer who has a registered certificate shall furnish the returns to the assessing authority in the prescribed form within 60 days of the expiry of the year.
If the assessing authority is not satisfied that the return filed by an employer is correct and complete, then the assessing authority has the power to assess the amount of tax payable by the employer and pass necessary orders in this regard. However the assessing authority shall given an opportunity of being heard to the employer before coming to his decision.
If an enrolled person or a registered employer fails, without reasonable cause, to make payment of any of tax within the required time or date, the assessing authority may impose upon him a penalty not exceeding fifty percent of the amount of tax due.
Any person or an employer, who without sufficient cause, fails to comply with any of the provisions of this Act, or the rules framed there under shall, on conviction, be punished with fine up to 5000 rupees .When an offence is committed by a company, every person who at the time the offence was committed, was in charge and was responsible for the company for the conduct of the business of the company shall be deemed to be guilty of the offence.
The assessing authority has the power to permit any person charged with an offence to compound the offence on payment of a sum not exceeding double the amount of the tax. Compounding can be permitted either before or after the institution of the prosecution.
Local authorities are not entitled to levy any tax on professions, trades, callings and employments.