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Professional tax is levied on earning individuals by the State Government. It is charged at various slab rates depending upon the income of the individual. Different states have different slabs. Find slabs applicable in your state in this guide by H&R Block.

Professional Tax in India, Slab Rates in Various States

Last Update Date : May 19, 2018

Professional Tax

As rightly said, “it takes more brains and efforts to make out the income-tax form than it does to make the income ”. Professional Tax is one such tax which differs from state to state. It is levied and collected by the State Government at various slab rates on every individual who earns his livelihood by the way of profession, trade, calling or employment. It is restricted to a maximum limit of ₹ 2,500 and allowed as a deduction under section 16 of the Income Tax Act, 1961.

What is Professional Tax?

Professional tax is a tax levied and collected by the State Government on every single earning individual who earns a living through any medium which can be a profession, trade, calling or employment. However, it should not be mixed with the professionals that means doctors, chartered accountants, lawyers, etc. Clause (2) of Article 276 of the Constitution of India provides the right to the State Government for levy and collection of professional tax or tax on the profession. As the rights remain with the State Government, certain states do not charge professional tax too. The tax is levied based on the slab rates depending upon the income of the individual. However, the maximum amount any State can levy as Professional Tax is restricted to ₹ 2,500. The amount paid as Professional Tax is allowed as a deduction under section 16 of the Income Tax Act, 1961 and the income tax on the balance amount shall be calculated as per the slabs applicable.

Who is Responsible to Pay?

In case of the salaried employees, the professional tax needs to be deducted from the salary by the employer on monthly basis and paid to the state government. If an individual is self-employed or in case he has no employer, the individual himself is liable to pay the professional tax.
However, a non-employed individual can register for professional tax by applying through a form. The registration number is issued after successful registration. Professional Tax can be paid under this registration number at various banks.

How to Pay Professional Tax?

The tax liability for the annum is divided into 12 instalments. To spread and to acquire the maximum tax up to ₹ 2,500 over the months, the instalment for February is usually higher. But it rests with the State jurisdiction as to how much and for which month to levy Professional Tax. The State jurisdiction of Kerela levies Professional Tax on half-yearly basis.

For example: To cover the liability of ₹ 2,500, the instalment will be ₹ 200 spread over 11 months and for the month of February will be ₹ 300 which will be deposited in the month of March to the Government.

Professional Tax Slab Rates in Various States

Professional Tax Slab Rates for Maharashtra

Monthly salary (₹) Tax per month (₹)
Up to ₹ 7,500/- for men NIL
Up to ₹ 10,000/- for women NIL
From ₹ 7,500/- to ₹ 10,000/- ₹ 175/-
₹ 10,000/- and above ₹ 200/- (₹ 300/- for the month of February)

Professional Tax Slab for Karnataka

Monthly salary (₹) Tax per month (₹)
Up to ₹ 15,000/- NIL
Above ₹ 15,000/- ₹ 200/-

Professional Tax Slab Rates for Gujarat

Monthly salary (₹) Tax per month (₹)
Up to ₹ 5,999/- NIL
From ₹ 6,000/- to ₹ 8,999/- ₹ 80/-
From ₹ 9,000/- to 11,999/- ₹ 150/-
₹ 12,000/- and Above ₹ 200/-

Professional Tax Slab Rates for West Bengal

Monthly salary (₹) Tax per month (₹)
Up to ₹ 8,500/- NIL
From ₹ 8,501/- to ₹ 10,000/- ₹ 90/-
From ₹ 10,001/- to ₹ 15,000/- ₹ 110/-
From ₹ 15,001/- to ₹ 25,000/- ₹ 130/-
From ₹ 25,001/- to ₹ 40,000/- ₹ 150/-
Above ₹ 40,000/- ₹ 200/-

Professional Tax Slab Rates for Madhya Pradesh

Annual salary (₹) Tax per month (₹)
Up to ₹ 1,50,000/- NIL
From ₹ 1,50,001 to ₹ 1,80,000/- ₹ 125/-
Above ₹ 1,80,000/- ₹ 212/-

Professional Tax Slab Rates for Tamil Nadu

Half yearly salary (₹) Tax per 6 months (₹)
Up to ₹ 21,000/- NIL
From ₹ 21,001 to ₹ 30,000/- ₹ 100/-
From ₹ 30,001 to ₹ 45,000/- ₹ 235/-
From ₹ 45,001 to ₹ 60,000/- ₹ 510/-
From ₹ 60,001 to ₹ 75,000/- ₹ 760/-
Above ₹ 75,000/- ₹ 1095/-

Professional Tax Slab Rates for Andhra Pradesh

Monthly salary (₹) Tax per month (₹)
Up to ₹ 15,000/- NIL
From ₹ 15,001/- to ₹ 20,000/- ₹ 150/-
Above ₹ 20,000/- ₹ 200/-

Professional Tax Slab Rates in Odisha

Monthly salary (₹) Tax per month (₹)
Up to ₹ 5,000/- NIL
From ₹ 5,001 to ₹ 6,000/- ₹ 30/-
From ₹ 6,001 to ₹ 8,000/- ₹ 50/-
From ₹ 8,001/- to ₹ 10,000/- ₹ 75/-
From ₹ 10,001/- to ₹ 15,000/- ₹ 100/-
From ₹ 15,001/- to ₹ 20,000/- ₹ 150/-
Above ₹ 20,000/- ₹ 200/-

Professional Tax Slab Rates for Bihar

Annual salary (₹) Tax for the year (₹)
Up to ₹ 3,00,000/- NIL
From ₹ 3,00,001/- to ₹ 5,00,000/- ₹ 1,000/-
From ₹ 5,00,001/- to ₹ 10,00,000/- ₹ 2,000/-
Above ₹ 10,00,000/- ₹ 2,500/-

Professional Tax Slab Rates for Telangana

Monthly salary (₹) Tax per month (₹)
Up to ₹ 15,000/- NIL
From ₹ 15,001/- to ₹ 20,000/- ₹ 150/-
Above ₹ 20,000/- ₹ 200/-

Professional Tax Slab Rates for Assam

Monthly salary (₹) Tax per month (₹)
Up to ₹ 10,000/- NIL
From ₹ 10,001/- to ₹ 15,000/- ₹ 150/-
From ₹ 15,001/- to ₹ 25,000/- ₹ 180/-
Above ₹ 25,000/- ₹ 208/- (₹ 212/- for the month of February)

Professional Tax Slab Rates for Sikkim

Monthly salary (₹) Tax per month (₹)
Up to ₹ 20,000/- NIL
From ₹ 20,001/- to ₹ 30,000/- ₹ 125/-
From ₹ 30,001/- to ₹ 40,000/- ₹ 150/-
Above ₹ 40,000/- ₹ 200/-

Professional Tax Slab Rates for Meghalaya

Monthly salary (₹) Tax per month (₹)
Up to ₹ 4,166/- NIL
From ₹ 4,167/- to ₹ 6,250/- ₹ 16.50/-
From ₹ 6,251/- to ₹ 8,333/- ₹ 25/-
From ₹ 8,334/- to ₹ 12,500/- ₹ 41.50/-
From ₹ 12,501/- to ₹ 16,666/- ₹ 62.50/-
From ₹ 16,667/- to ₹ 20,833/- ₹ 83.33/-
From ₹ 20,834/- to ₹ 25,000/- ₹ 104.16/-
From ₹ 25,001/- to ₹ 29,166/- ₹ 125/-
From ₹ 29,167/- to ₹ 33,333/- ₹ 150/-
From ₹ 33,334/- to ₹ 37,500/- ₹ 175/-
From ₹ 37,501/- to ₹ 41,666/- ₹ 200/-
Above ₹ 41,666/- ₹ 208/- (₹ 212/- for the month of February)

Professional Tax Slab Rates for Kerala

Monthly salary (₹) Tax per month (₹)
Up to ₹ 1,999/- NIL
From ₹ 2,000/- to ₹ 2,999/- ₹ 20/-
From ₹ 3,000/- to ₹ 4,999/- ₹ 30/-
From ₹ 5,000/- to ₹ 7,499/- ₹ 50/-
From ₹ 7,500/- to ₹ 9,999/- ₹ 75/-
From ₹ 10,000/- to ₹ 12,499/- ₹ 100/-
From ₹ 12,500/- to ₹ 16,666/- ₹ 125/-
From ₹ 16,667/- to ₹ 20,833/- ₹ 166/-
Above ₹ 20,834/- ₹ 208/- (₹ 212/- for the month of February)

Professional Tax Slab Rates in Chattishgarh

Annual salary (₹) Tax per month (₹)
Up to ₹ 1,50,000/- NIL
From ₹ 1,50,001/- to ₹ 2,00,000/- ₹ 150/-
From ₹ 2,00,000/- to ₹ 2,50,000/- ₹ 180/-
From ₹ 2,50,001/- to ₹ 3,00,000/- ₹ 190/-
Above ₹ 3,00,000/- ₹ 200/-

Professional Tax Slab Rates for Tripura

Monthly salary (₹) Tax per month (₹)
Up to ₹ 5,000/- NIL
From ₹ 5,001/- to ₹ 7,000/- ₹ 70/-
From ₹ 7,001/- to ₹ 9,000/- ₹ 120/-
From ₹ 9,001/- to ₹ 12,000/- ₹ 140/-
From ₹ 12,001/- to ₹ 15,000/- ₹ 190/-
Above ₹ 15,000/- ₹ 208/- (₹ 212/- for the month of February)

Who is Exempt from Paying Tax?

Professional tax is not applicable where:

  • An assessee has completed 65 years of age. For the state of Karnataka it is 60 years.
  • A person suffering 40% or more of permanent physical disability or blindness.
  • Parent or guardian of a physically challenged or mentally retarded child.

However, it should be noted that the above provisions can vary in different states.

States and Union Territories where Professional Tax is not Applicable

STATES UNION TERRITORIES
Arunachal Pradesh Andaman & Nicobar
Haryana Chandigarh
Himachal Pradesh Delhi
Jammu & Kashmir Puducherry
Punjab Dadra & Nagar Haveli
Rajasthan Daman & Diu
Nagaland Lakshadweep
Uttaranchal
Uttar Pradesh

Penalties for Non-compliance with the Laws of Professional Tax

  • In case of delay in obtaining the registration certificate, a penalty of ₹ 5 per day in case of the employer and ₹ 2 per day in case of a non-employed individual shall be imposed.
  • In case of delay in payment of professional tax, a penalty of 2% per month of the amount of tax shall be levied. However, in case of non-payment of such professional tax, the assessee would attract an additional penalty of 10% of the amount of tax due.
  • In case of delay in filing the returns, a penalty of ₹ 1,000 shall be charged if the returns are filed within 1 month after the due date. Where the return is not filed even after 1 month post the due date of filing return, the penalty shall be ₹ 2,000.
  • If the information provided by the individual at the time of enrolment is found incorrect or false, it shall attract the penalty of three times of the professional tax payable.

Taxes are on our minds 24×7 since it influences our daily lives and daily earnings. Reading taxes won’t end up in paying less but gives you a chuck on how you can save and plan your taxes in the future. Plan your taxes and reach our experts to raise the bar every single time. The professionals at H&R Block are always excited to serve you.

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