Karnataka Professional Tax Update 2024: Deadline Extension & Key Changes

Understanding the Karnataka Tax on Professions, Trades, Callings, and Employments (Removal of Difficulties) Order, 2024

In 2024, the Karnataka government issued an important update regarding professional taxes. This update is known as the Karnataka Tax on Professions, Trades, Callings, and Employments (Removal of Difficulties) Order, 2024. Let's break down what this means for professionals, businesses, and employers in Karnataka.

Background

The Karnataka Tax on Professions, Trades, Callings, and Employments Act, 1976, requires individuals and businesses engaged in various professions, trades, and callings to pay a professional tax. Enrolled persons are expected to file their returns and pay the due taxes as per the timelines prescribed in the Act.

Key Changes

The new order addresses some practical challenges faced by taxpayers, particularly issues related to the timely payment of taxes and filing of returns.

Issues Addressed

1. Technical Glitches: Many taxpayers experienced difficulties due to technical issues on the professional tax portal. These issues made it hard for them to meet the deadlines for filing returns and making tax payments.

2. Representation by Professional Bodies: Organizations like the Federation of Karnataka Chambers of Commerce and Industry and the Karnataka State Tax Practitioners Association highlighted these problems to the government. They requested an extension for the deadlines to accommodate the delays caused by these glitches.

Amendments Made

To address these issues, the government issued Order No. FD 02 CPT 2024 on May 30, 2024. Here are the key points of this order:

1. Short Title and Commencement: The order is officially titled "The Karnataka Tax on Professions, Trades, Callings, and Employments (Removal of Difficulties) Order, 2024." It came into effect on the date of its publication in the Official Gazette.

2. Amendment to Section 10: The order amends Section 10 of the 1976 Act. It specifically adds a provision for the financial year 2024-25:

   • For those enrolled before the financial year began, the deadline for paying the due tax amount has been extended to May 31, 2024.

Impact on Taxpayers

For Existing Enrolled Persons

If you were already enrolled before the start of the financial year 2024-25, you now have until May 31, 2024, to pay your professional tax. This extension provides some relief and ensures you are not penalized for delays caused by technical issues.

For New Enrollees

The deadlines for those enrolling after the start of the financial year remain unchanged. They must pay their taxes within one month of enrollment.

Conclusion

The Karnataka government's proactive approach in extending the deadline demonstrates a commitment to addressing taxpayer concerns and ensuring smoother compliance processes. This order is a significant step towards making tax payment more manageable and less stressful for professionals and businesses in Karnataka.

If you have any questions or need further assistance regarding the Karnataka Tax on Professions, Trades, Callings, and Employments (Removal of Difficulties) Order, 2024, it's advisable to consult with a tax professional or reach out to the relevant tax authorities.

Please refer notification for more details.

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