Professional Revenue enhancement (PT) is i of the statutory compliance requirements for businesses. Dissimilar TDS, EPF and ESI, PT is levied past the corresponding state governments.

Simply there's a catch!

Non all Indian states impose a professional person tax. Also, the tax applicable to different income slabs may vary from one land to another, simply it has a maximum limit of Rs two,500 per yr.

Let's dig farther to know the applicability of professional revenue enhancement, the states where such tax is applicative, and how RazorpayX Payroll  simplifies it for businesses.

What is Professional Tax

Professional tax is a direct tax that applies to individuals earning an income by way of employment, practising their profession, or trading. A practicing professional includes a lawyer, teacher, doc, chartered auditor, etc.

The taxation is deducted from the private'south monthly salary past their employer and is deposited to the state governments. Professionals autonomously from salaried employees pay information technology directly to the authorities.

Such professionals can claim a tax deduction for the professional person taxation paid during the financial twelvemonth every bit per the Income Tax Act 1961.

Who is responsible to collect and pay professional tax?

In the case of a salaried employee, the employer must deduct professional tax from their salary every calendar month and deposit information technology to the government. The employer needs to become a Registration Certificate from the concerned regime to eolith the deducted tax.

Whereas, the cocky-employed individuals who carry out their profession or trade and fall into eligibility criteria are required to pay the professional person tax themselves to the state regime. They demand to obtain a Certificate of Enrolment from the concerned state's prescribed authority.

Every state/UT has a commercial revenue enhancement department that collects professional person tax based on predetermined income slabs.

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Professional taxation registration and process

All employers must obtain professional tax registration within 30 days of employing individuals. In the case of other professionals, the registration must be obtained within 30 days from the start of their practice.

If the employer has more than one function, then the registration must be obtained for each office depending on the corresponding state rules.

It might be challenging for employers to take hold of hold of the registration procedure of all united states wherever professional tax is applicative.

To ease the complexities of registration processes beyond states, nosotros congenital RazorpayX Payroll .

RazorpayX Payroll is an automated payroll software that takes care of everything payroll related right from bacon disbursement to getting statutory compliance requirements right. The product besides handles professional tax state-wise registrations for employers and saves a lot of valuable fourth dimension.

Professional Tax slabs in various states

Here's the list of states where PT is applicable along with the tax amount:

State Period of deduction Income slabs Tax amount
Andhra Pradesh Monthly Upwards to INR fifteen,000 Zero
INR 15,001 to INR 20,000 INR 150
More than than INR 20,000 INR 200
Assam Monthly Upward to INR 10,000 Naught
INR ten,001 to INR 15,000 INR 150
INR xv,001 to INR 25,000 INR 180
More than than INR 25,000 INR 208
Bihar Yearly Upwards to INR iii lakh Nothing
Between INR 3 lakh to INR five lakh INR ane,000
Betwixt INR 5 lakh to INR 10 lakh INR 2,000
To a higher place INR 10 lakh INR 2,500
Jharkhand Yearly Up to INR 3 lakh Nil
Betwixt INR 3 lakh to INR 5 lakh INR i,200
Betwixt INR v lakh to INR 8 lakh INR i,800
Betwixt INR viii lakh to INR 10 lakh INR two,100
Higher up INR 10 lakh INR two,500
Gujarat Monthly Up to INR 5999 Nil
INR 6000 to INR 8999 INR 80
INR 9000 to INR 11999 INR 150
More than INR 12000 INR 200
Karnataka Monthly Up to INR xv,000 Nil
Above INR xv,000 INR 200
Kerala Half-yearly Upward to INR 11,999 Nil
INR 12,000 to INR 17,999 INR 120
INR 18,000 to INR 29,999 INR 180
INR 30,000 to INR 44,999 INR 300
INR 45,000 to INR 59,999 INR 450
INR 60,000 to INR 74,999 INR 600
INR 75,000 to INR 99,999 INR 750
INR 1,00,000 to INR 1,24,999 INR ane,000
Above INR ane,25,000 INR 1,250
Madhya Pradesh Monthly Upward to INR 2,25,000 Nil
Between INR 2,25,001 to INR 3,00,000 INR i,500 (INR 125 Per Month)
Between INR 3,00,000 to INR 4,00,000 INR 2,000 (INR 166 Per Calendar month For 11 Months And INR 174 For 12th Month)
Higher up INR four,00,001 INR 2,500 (INR 208 Per Calendar month For 11 Months And INR 212 For 12th Month)
Maharashtra Monthly Upward to INR vii,500 Nil
Between Rs vii,501 to Rs 10,000 INR 175 (Nil for women)
Above INR 10,000 INR 200
INR 300 (Employer has to deduct in the February calendar month only)
Manipur Yearly Up to INR 50,000 Nil
INR 50,000 onwards to Rs 75,000 INR 1,200
INR 75,000 onwards to INR 1,00,000 INR 2,000
INR 1,00,000 onwards to INR 1,25,000 INR 2,400
To a higher place INR ane,25,000 INR 2,500
Meghalaya Yearly Upward to INR 50,000 Cipher
Between INR 50,001 to INR 75,000 INR 200
Between INR 75,001 to INR i,00,000 INR 300
Between INR 1,00,001 to INR ane,50,000 INR 500
Between INR 1,50,001 to INR 2,00,000 INR 750
Between INR two,00,001 to INR 2,50,000 INR ane,000
Between INR 2,50,001 to INR iii,00,000 INR one,250
Between INR three,00,001 to INR 3,50,000 INR ane,500
Between INR 3,50,001 to INR 4,00,000 INR 1,800
Between INR 4,00,001 to INR 4,50,000 INR 2,100
Between INR 4,fifty,001 to INR v,00,000 INR 2,400
Above INR 5,00,001 INR two,500
Mizoram Monthly Upward to INR 5,000 Nil
Betwixt INR 5,001 to INR 8,000 INR 75 (Assessee may pay in lump sum INR 900 per annum)
Betwixt INR viii,001 to INR ten,000 INR 120 (Assessee may pay in lump sum INR 1440 per annum)
Between INR ten,001 to INR 12,000 INR 150 (Assessee may pay in lump sum INR 1800 per annum)
Between INR 12,001 to INR 15,000 INR 180 (Assessee may pay in lump sum INR 2160 per annum)
In a higher place INR fifteen,001 INR 208 (Assessee may pay in lump sum Rs 2500 per annum)
Nagaland Monthly Upward to INR 4,000 Zip
Between INR 4,001 to INR 5,000 INR 35
Between INR 5,001 to INR 7,000 INR 75
Between INR 7,001 to INR 9,000 INR 110
Between INR ix,001 to INR 12,000 INR 180
To a higher place INR 12,001 INR 208
Odisha Yearly Upwards to INR one,threescore,000 Nil
Between INR ane,threescore,001 to INR 3,00,000 INR i,500
Above INR 3,00,001 INR 2,500
Puducherry Yearly Up to INR 99,999 Aught
Between INR ane,00,000 to INR two,00,000 INR 250
Between INR 2,00,001 to INR 3,00,000 INR 500
Between INR 3,00,001 to INR 4,00,000 INR 750
Betwixt INR 4,00,001 to INR 5,00,000 INR one,000
Above INR 5,00,001 INR 1,250
Punjab Monthly In a higher place INR 2,50,000 INR 200
Sikkim Monthly Up to INR 20,000 Nil
Between INR 20,001 to INR thirty,000 INR 125
Between INR thirty,001 to INR xl,000 INR 150
Above INR 40,000 INR 200
Tamil Nadu Monthly Up to INR 21,000 Zilch
Between INR 21,001 to INR 30,000 INR 135
Between INR 30,000 to INR 45,000 INR 315
Between INR 45,001 to INR 60,000 INR 690
Between INR 60,001 to INR 75,000 INR ane,025
In a higher place INR 75,000 INR 1,250
Telangana Monthly Up to INR 15,000 Nix
Betwixt INR 15,001 to INR twenty,000 INR 150
Above INR xx,001 INR 200
Tripura Yearly Up to INR seven,500 Nil
Betwixt INR 7,501 to Rs fifteen,000 INR ane,800
Above INR xv,001 INR ii,496
West Bengal Monthly Up to INR 10,000 Goose egg
Betwixt INR ten,001 to INR 15,000 INR 110
Betwixt INR 15,001 to INR 25,000 INR 130
Between INR 25,001 to Rs 40,000 INR 150
Higher up INR 40,000 INR 200

With RazorpayX Payroll , professional person tax payments are also taken care of along with registrations. The product uses a straight deposit model like to whatever payment wallet where the user maintains a residual. The payroll expenses are automatically deducted from such balance every bit on the respective due dates.

It takes intendance of all the statutory payments such as PF, ESI, PT, and TDS automatically and also their periodical returns.

Suggested Read: Why Your Employees Demand ESI

There is no need to spend time and transmission efforts on maintaining employee records, their PT contribution, and payment to concerned regime once a RazorpayX Payroll account has been set up.

Ready your RazorpayX Payroll business relationship at present

Here'due south the list of states where professional person tax is not applicable.

Andaman and Nicobar Islands Himachal Pradesh
Arunachal Pradesh Jammu and Kashmir
Chandigarh Ladakh
Chhattisgarh Lakshadweep
Dadra and Nagar Haveli Rajasthan
Daman and Diu Uttar Pradesh
Delhi Uttarakhand
Goa Haryana

What is the process to pay professional person tax? Is whatever return to be filed?

Professional person tax is a land subject. There is no fixed procedure to pay professional taxation. It can be paid either online or offline modes depending on the state from where the business organisation is operating.

Also, the intervals and procedure for filing professional person tax returns depend on the Land.

Consequences of violation of professional person revenue enhancement regulation

The actual penalty depends on the corresponding State professional tax laws. Businesses might take to pay penalty, belatedly fee or interest for non-registration, filibuster in tax payments and non-filing of returns within the specified due date.

For example, the Karnataka land regime charges an involvement of 1.25% per month for whatsoever late revenue enhancement payments. Whereas, Due west Bengal charges 12% per annum.

Exemptions in Professional Tax

The following individuals are exempt from paying professional person revenue enhancement:

  1. Parents or guardians of children with a mental disability or permanent disability
  2. An private suffering from a permanent physical disability including blindness
  3. Whatsoever individual of above 65 years
  4. Members of the forces every bit defined in the Air Force Deed, 1950, the Regular army Human activity, 1950 and the Navy Act, 1957 including members of auxiliary forces or reservists, serving in the state
  5. Temporary workers employed in the textile industry
  6. Women exclusively engaged equally agents under the Mahila Pradhan Kshetriya Bachat Yojana

The lesser line

Whatever failure to obtain professional person tax registration or depositing ante to the concerned authorities might state employers and professionals in problem. Punishment/belatedly fee or interest rates on tardily registrations or late payments are different for each state.

With RazorpayX Payroll, you, as an employer, can avert all such consequences. The product volition take care of all your professional tax dues payment and their return filing on fourth dimension ; leaving no telescopic for default with statutory compliance requirements.

Frequently Asked Questions

Is professional person revenue enhancement paid monthly or yearly?

Since professional taxation is levied by state governments, it tends to differ for unlike states. Each state declares a slab and the professional person revenue enhancement is deducted on the footing of those slabs. Notwithstanding, in that location are few states and union territories in Republic of india that do not charge professional taxation likewise. It is paid by dividing the annual professional tax due into 12 equal installments, which are to exist paid every month. February, as a month, is an exception where the tax is college than the other months.

Can nosotros claim professional tax?

​A person can claim the refund of the excess tax paid/deducted during a financial year past filing the income tax returns for that year. As per the Income Tax Act, an individual is required to file the return in the relevant assessment year by July 31 (unless the deadline is extended) to merits the refund from professional person tax.

What is the rule for professional revenue enhancement?

The land government has all authority to make laws with respect to professional taxation though being a tax on income under Article 276 of the Constitution of Bharat which deals with tax on professions, trades, callings, and employment.