Professional Tax According to Various States and UTs across India

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Professional Tax According to Various States and UTs across India

The professional tax paid by an employee is allowed as a deduction from their gross salary income under Section 16 (iii) of the Income Tax Act, 1961. While most states and UTs have professional tax, certain states and UTs in India do not have it.

In this article, we will discuss what professional tax is and the states and UTs where this type of tax is applicable along with the professional tax slabs. 

What is the Professional Tax?

Professional tax is a type of direct tax which is levied on individuals earning an income by the way of either practicing a profession, employment, trade or calling. Income tax is levied by the Central Government. However, professional tax is levied by the Government of a State or UT in India. Majority of states in India impose professional tax, but this tax is not applicable in certain states like Haryana and Uttar Pradesh.

The deduction of professional tax under Section (iii) of the Income Tax Act, 1961, is limited to Rs. 2,500 per year. If the employer pays the professional tax on the employee’s behalf, the amount will be deducted from the employee’s salary. 

Which States and Union Territories levy Professional Tax?

Here is a list of the states and union territories in India where the professional tax in levied on individuals who earn their income through trade, employment, calling or profession:

1. Karnataka
2. Maharashtra
3. Tamil Nadu
4. Assam
5. Kerala
6. Meghalaya
7. Tripura
8. Bihar
9. Jharkhand
10. Madhya Pradesh
11. West Bengal
12. Manipur
13. Mizoram
14. Odisha
15. Puducherry
16. Sikkim
17. Telangana
18. Nagaland
19. Chhattisgarh
20. Gujarat
21. Punjab

Which States and Union Territories do not levy Professional Tax?

Following are the Indian states and union territories where the professional tax is not applicable on individuals:

1. Arunachal Pradesh
2. Himachal Pradesh
3. Delhi
4. Haryana
5. Uttar Pradesh
6. Uttarakhand
7. Andaman and Nicobar Islands
8. Daman & Diu
9. Dadra and Nagar Haveli
10. Lakshadweep
11. Jammu & Kashmir
12. Rajasthan
13. Chandigarh
14. Goa

Professional Tax Slabs for Various States and Union Territories

Let’s take a look at the tax slabs for professional tax across various states and union territories in India.

Professional Tax Slab for Andhra Pradesh

The professional tax in Andhra Pradesh is deducted on a monthly basis. Here is the professional tax slab for this state:

Professional Tax Slab for Assam

The professional tax in Assam is deducted every month. The professional tax slab for Assam is mentioned below:

Professional Tax Slab for Bihar

In the case of Bihar, the professional tax is deducted once every year. The professional tax slab for Bihar is mentioned herewith:

Professional Tax Slab for Chhattisgarh

In the case of Chhattisgarh, the professional tax is deducted once a month. The professional tax slab for Chhattisgarh is mentioned herewith:

*Rs. 212 will be deducted once every year; in the last month of the deduction cycle of individuals with salaries exceeding Rs. 250,001.

Professional Tax Slab for Gujarat

The Professional Tax in Gujarat is deducted on a monthly basis. You can find the professional tax slab for Gujarat below:

Professional Tax Slab for Jharkhand

For the state of Jharkhand, the Professional Tax is deducted every quarter. You can check out the professional tax slab for Jharkhand below:

Source: Department of Commercial Taxes (Jharkhand)

Professional Tax Slab for Karnataka

For the state of Karnataka, the professional tax is deducted per month. The professional tax slab Karnataka is mentioned below:

Professional Tax Slab for Kerala

The Professional Tax is deducted once in every 6 months in Kerala. The professional tax is deducted as per the professional tax slab mentioned below:

Professional Tax Slab for Madhya Pradesh

The Professional Tax is deducted on a monthly basis in the state of Madhya Pradesh. The professional tax slab for Madhya Pradesh is mentioned in the the table below:

*In case of employees who earn more than Rs. 25,001 and less than Rs. 33,333 per month, Rs. 166 shall be deducted as professional tax for the first 11 months while in the last month, Rs. 174 shall be deducted.

*In case of employees who earn more Rs. 33,334 per month, Rs. 208 shall be deducted as tax for the first 11 months, for the last month Rs. 212 shall be deducted.

Professional Tax Slab for Maharashtra

The Professional Tax is paid by the eligible individuals in Maharashtra on a monthly basis. Here is the professional tax slab for this state:

*The employees that earn above Rs. 10,001 in Maharashtra are liable to pay professional tax for Rs. 200 for the first 11 months and Rs. 300 for the last month.

Professional Tax Slab for Manipur

For the state of Manipur, the professional tax is deducted on an annual basis. The professional tax is deducted for this state as per the table below:

Professional Tax Slab for Meghalaya

When it comes to Meghalaya, the professional tax is paid by the individuals every month. Find the professional tax slab for this state below:

Professional Tax Slab for Mizoram

The professional tax in Mizoram is deducted per month. You can check out the professional tax slab for this state in the table mentioned below:

Professional Tax Slab for Naaland

The professional tax in Nagaland is deducted per month. You can check out the professional tax slab for this state in the table mentioned below:

Professional Tax Slab for Odisha

Like most states where the professional tax is applicable, the professional tax in Odisha is deducted on a monthly basis. You can check out the professional tax slab for Odisha below:

*In case of employees who earn at least Rs. 3 lakhs or above, Rs. 200 shall be deducted as professional tax for the first 11 months, while for the last month Rs. 300 shall be deducted.

Professional Tax Slab for Puducherry

In Puducherry (Pondicherry), the Professional Tax is deducted once every 6 months. The table mentioned below states how the professional tax is deducted in this Union Territory:

Professional Tax Slab for Punjab

For the state of Punjab, the professional tax is deducted on a monthly basis. Here is the professional tax slab for Punjab:

Professional Tax Slab for Sikkim

For Sikkim, the professional tax is deducted on a monthly basis. Here is the professional tax slab for Sikkim:

In Tamil Nadu, the professional tax is paid by the eligible individuals every 6 months. Let’s take the look at the table below to understand how the professional tax is deducted in this state:

Professional Tax Slab for Telangana

For the state of Telangana, the professional tax is deducted every month. The table below shows how the professional tax is deducted in this state:

Professional Tax Slab for Tripura

In the case of Tripura, the professional tax has to be paid by eligible individuals once a month. Here is the professional tax slab for the state of Tripura:

Professional Tax Slab for West Bengal

The professional tax is deducted every month in the state of West Bengal. Here is the professional tax slab for this state:

Conclusion

Most states and UTs in India make it mandatory for the individuals to pay professional tax on the salary earned by them. While in most states and UTs, the professional tax is deducted on a monthly basis, in certain states and UTs, the professional tax is deducted once a year or once in 6 months. For any tax preparation services, feel free to connect with Registrationwala - Your Tax Specialist!

Disclaimer: The Professional Tax Slabs mentioned in this blog post are subject to change, and we recommend you to check the latest professional tax slabs by checking the official Tax Department websites of such States/UTs. Since this blog is for educational purposes only, it is advised to consult with a tax specialist for any advice or assistance regarding professional tax. 

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