Quick Summary
Professional Tax is a state-level tax deducted from salary or paid by professionals and self-employed individuals. It is mandatory in 17+ states and has a maximum limit of ₹2,500 per annum.
Professional Tax is levied by state governments on individuals earning income from salary or practicing any profession, trade, or calling. It is deductible under Section 16(iii) of Income Tax Act.
States Where Applicable
Professional Tax is applicable in: Karnataka, Maharashtra, Tamil Nadu, Andhra Pradesh, Telangana, Gujarat, Kerala, West Bengal, Madhya Pradesh, Bihar, Jharkhand, Odisha, Chhattisgarh, Assam, Meghalaya, Sikkim, and Pondicherry.
Tax Slabs (Varies by State)
- Up to ₹15,000: Nil
- ₹15,001 - ₹25,000: ₹100-200/month
- ₹25,001 - ₹50,000: ₹150-200/month
- Above ₹50,000: ₹200/month (max ₹2,500/year)
Registration and Payment
Employers must deduct PT from salary and deposit monthly/quarterly. Self-employed must register and pay directly. Late payment attracts penalties.
Key Points
- State-level tax, not applicable in all states
- Maximum ₹2,500 per annum
- Employers must deduct from salary
- Self-employed must register separately
- Professional Tax Registration Certificate (PTRC) required
- Professional Tax Enrollment Certificate (PTEC) required