Who sets professional tax slabs?

Each state sets its own slabs, exemptions and periodicity.

How do multi-state employers handle PT?

They run several schedules rather than one.

Is professional tax the same as TDS?

No. TDS is income tax withheld under Section 192; PT is a state tax on employment.

Are there PT exemptions?

Exemptions exist and are set by each state.

HR & payroll glossary

Professional tax

Companies on HRMagix: 120+
Employees managed: 9,000+
Integrated modules: 12
Free trial, no card: 14-day

Definition

A tax on employment levied by some Indian states. Slabs, exemptions and periodicity are set by each state, and at least one state deducts a different amount in a single month of the year, so a multi-state employer runs several schedules rather than one.

In practice

Professional Tax is deducted monthly in most states that levy it, but the slabs, amounts, frequency and filing dates vary by state, and some states do not levy it at all. Payroll maps each employee to the state of their work location and applies that state's slab.

The employer needs a registration in each state where it has employees covered by PT, and returns are filed with that state's authority on its schedule. Some states collect a different amount in one month of the year, which payroll must build in.

The common mistake is applying the head office state's rules to employees working elsewhere. Another is forgetting the employer's own enrolment, which some states require separately from the deduction registration. Check each state's current schedule.

Questions that involve Professional tax

FAQs