Karnataka Professional tax on Partners of a firm or the LLP

Partners of LLP who are engaged in any profession, trade, or calling are exempt from paying Profession Tax in the state of Karnataka, provided the tax is already paid by the LLP in which they are the partners. The LLP is a separate legal entity and is separately listed in the schedule of the Karnataka Tax on Professions, Trades, Callings and Employments Act, 1976, as amended by the 2023 Amending Act. Therefore, the LLP is mandatorily required to enrol under the PT and pay an annual professional tax of ₹ 2500/- within its due date.

Although the partnership firm is not listed separately as a taxpayer under the PT Schedule, it may still be subject to the professional tax. The professional tax schedule in Karnataka has four categories, and if a person falls under any of these categories, they will be liable to pay the tax. Additionally, if the partnership firm pays the professional tax at a rate of ₹2500 per annum, then the individual partners of that firm are exempt from paying professional tax.