In India, Professional tax is levied on persons working in the government and non-government sectors, or by the respective state governments in any profession such as chartered accounts, lawyers, doctors, etc. The tax levied in this manner differs from the state: the state due to the difference in tax rates set by the respective state governments. Professional tax collected from a salaried employee is considered a deduction under the Income Tax Act. This article explores various aspects of Bihar commercial tax.

Bihar State Government collects Bihar Professional Tax from persons earning from salary or occupations (e.g. Chartered Accountant, Lawyer etc.) or engaged in business or business, professional tax has to be paid. To pay professional tax, registration has to be done as per the rules laid down by the respective state governments. In this article, we will focus specifically on the registration process for professional tax.

Bihar Professional Tax Act, 2011

The Professional Tax Department, regulated under the Government of Bihar, is responsible for collection of professional tax arrears from professionals in the state. According to the provisions of the Bihar Professional Tax Act, 2011, a provision has been set to impose a business tax of 2500 (as maximum) and a yearly (minimum Rs. 1000) on persons associated with a business or profession.

In India, professional tax is regulated by the respective state governments on persons working in government and non-government sectors or from income from business or business or by profession such as professionals, company secretaries, chartered accountants etc. The professional tax levied on such persons varies. The amount recovered as professional tax from a salaried employee is considered a deduction under the Income Tax Act.

The Professional tax collected by the Bihar State Government is included under the Bihar Professional Tax Act, 2011.The Commercial Tax Department is responsible for collecting professional tax in Bihar. Maximum of Rs. 2500 and a minimum of Rs. 1000 per year can be collected as professional tax. The state government does not charge any application fee for professional tax registration.

Benefits of professional tax registration in Bihar

Benefits for professional tax registration are as follows:

• It helps to comply with state laws.
• It protects the interests of the employer and the employee or the person engaged in the business / business, or the practice of any profession.
• The commercial taxes deducted are in accordance with the slab rates prescribed by the state government in accordance with the applicable regulations and act.

Documents Required for Professional Tax Registration in Bihar

Some essential documents have been prepared for professional tax registration in Bihar, which are as follows:

• Filled application form
• Address proof of the applicant (which includes telephone, electricity bill or driving license or copy of passport)
• Applicant’s ID proof (which includes voter ID card or Aadhaar card or driving license or copy of passport)
• PAN card copy or PAN of partner or proprietor or doer or PAN card of employer
• Bank account details (including a passbook or copy of bank account details showing bank name and bank account number.)
• Two passport size photos

Tax Slab Rate for Bihar Professional Tax

Professional tax slab rates in Bihar are determined according to the Businesses, Trades, Calling and Employees Act, 2011:

S.N.	Class of Taxpayer	Tax Amount Payable
1.	Salaried individuals have income between Rs 3 lakh to Rs 3 lakh per year and range between Rs 5 lakh and Rs 5 lakh per annum. Annual income of more than 10 lakh rupees per year	1000 rupees per year 2000 rupees per year 2500 rupees per year
2.	Dealer registered under Bihar VAT Act, 2005 or registered only under Central Sales Tax Act, 1956: Sales or purchase turnover is up to Rs 10 lakhs, with sales or purchases ranging between Rs 10 lakhs and Rs 20 lakhs. A turnover of Rs 20 lakh per year for sale or purchase, turnover of Rs 20 lakh and annual turnover of sale or purchase is up to Rs 40 lakh. Over 40 lakh rupees per year	Nil (Rs. 1000 per year. 2000 per year. Rs. 2500 per year)
3.	Holding is permitted for transportation under the Motor Vehicles Act, 1988, which can be used for fire or reward, where any person holds a permit for: Bus or truck like any taxi passenger car or any vehicle	Rs 1000 per year Rs 1500 per year
4	Companies registered under the Companies Act, 1956 and engaged in any profession or business or calling	Rs 2500 per year

Process For Professional Tax Regulation in Bihar

Some steps have been made for registration of Bihar professional tax, these steps should be followed: 

Step 1: Visit the official website of the Commercial Tax Department of the Government of Bihar. 

Step 2: Under e-Services tab, click on e-registration. 

Step 3: After that the next page will appear, select the Commercial Tax option.

Step 4: Then the applicant has to fill all the required details and upload the related documents and then click on the add button. 

Step 5: Then click on submit.

Step 6: Acknowledgment receipt will be generated and the applicant will need to save the receipt for future reference. 

Once the registration is approved through the concerned authority, the applicant is notified via an SMS or email. The registration process is usually 15 days from the date of application and after filling the verification form. The deputy commissioner, assistant commissioner and commercial tax officer are designated as the authority to grant a professional tax registration certificate.

Track Professional Tax Registration in Bihar

The application registration status can be easily checked by visiting the official website and then selecting the registration type. Then enter the application number on the acknowledgment receipt.

Penalty in the case of Professional Tax in Bihar

If a taxpayer fails to pay the professional tax within the specified time, the assessing authority may impose a penalty of 2% of the tax amount for each month until the default continues.

Conclusion

Bihar Professional Tax is applicable to persons who are receiving salary from their employer or engaged in trade / occupation or practice any business. It is clear from the article above that state governments set the tax slab rate to levy professional tax.