Professional tax state-wise guide: slabs, registration, due dates and penalties

Professional tax is a small state-level tax on salaries and on the income of businesses and professionals, capped at ₹2,500 a year per person under Article 276 of the Constitution. Around 20 states levy it; Delhi, Uttar Pradesh, Haryana, Rajasthan and Punjab do not. As an employer you deduct it from each salary by the state slab and deposit it monthly, quarterly or annually depending on the state, and you usually also pay a flat ₹2,500 a year for the business itself. Here are the slabs, registrations, due dates and penalties, state by state.

What professional tax is and who levies it

Despite the name, professional tax is not only for professionals. It is a tax "on professions, trades, callings and employments" that state legislatures may levy under Entry 60 of the State List. Article 276(2) caps it at ₹2,500 per person per year, which is why every state's top slab converges on ₹200 a month (₹2,400) plus a ₹300 month, or a straight ₹2,500 annual figure.

Each state has its own Act, its own department (the commercial tax or GST department in most states, municipalities in Kerala and Tamil Nadu) and its own portal. There is no central law, no central portal, and the slabs differ. If you employ people in more than one state, you deal with each state separately based on where the employee works, not where your head office is.

Two people pay it in a typical small business: the employees (through you, as a deduction from salary) and the owner or the firm itself (directly, as an enrolled person). Keep these two hats separate; most confusion about PT comes from mixing them.

Two certificates: enrolment for the business, registration for the employer

Every PT state issues two kinds of certificate, though the names vary.

A freelancer with no staff needs only enrolment. A shop with three employees on ₹15,000 in Maharashtra needs both: PTEC for the proprietor and PTRC to deduct ₹200 from each salary. A private limited company needs PTEC for the company, PTEC for each director in most states, and PTRC as employer.

Applications are online on the state portal (mahagst.gov.in for Maharashtra, the Karnataka e-PRERANA or KTP portal, wbcomtax for West Bengal, and so on). You will need PAN, Aadhaar, address proof, bank details, the date of commencement and, for PTRC, the number of employees and their salaries. Most states expect registration within 30 days of becoming liable and issue the certificate in a few days. GST registration data is increasingly used to auto-enrol businesses in Maharashtra, so you may find a PTEC number already exists for your PAN.

State-wise slabs for salaried employees

The table gives the monthly deduction for an employee at each slab as of FY 2026-27. Slabs change by state budget notification, so confirm on the state portal before you set up payroll.

Tamil Nadu and Kerala work on half-yearly income and are collected by the local body, not the state department.

Chhattisgarh, Sikkim, Meghalaya, Tripura, Manipur, Mizoram, Nagaland and Puducherry also levy PT with their own slabs. Maharashtra, Karnataka and several other states exempt persons above 60 or 65, persons with a permanent disability, and parents of a child with a disability; check the exemption list before you deduct.

States with no professional tax

Delhi, Uttar Pradesh, Haryana, Rajasthan, Punjab, Uttarakhand, Himachal Pradesh, Goa, Jammu and Kashmir, Ladakh, Arunachal Pradesh, Chandigarh, Dadra and Nagar Haveli and Daman and Diu, Lakshadweep and the Andaman and Nicobar Islands do not levy professional tax on employees. If your entire team sits in Noida or Gurugram, you have no PT deduction and no PT registration to worry about.

One caveat for Punjab: since 2018 the state levies a Punjab State Development Tax of ₹200 a month on persons with income above the basic exemption limit. It is not called professional tax, but employers in Punjab deduct and deposit it in exactly the same way, so treat it as PT for payroll purposes.

Due dates and returns by state

Payment and return frequency depends on the state and often on how much PT you deducted last year. This is the part that changes most often, so treat the table as a starting point and verify on the portal.

Where the state gives you a choice between monthly and annual filing, take annual only if you are sure you will remember it; a single missed annual return carries the same penalty as twelve missed monthly ones.

Penalties for late registration, payment and returns

Penalties differ by state, but the structure is similar everywhere: a daily penalty for not registering, interest on late payment, a fixed fee for a late return, and a percentage penalty for non-payment. Maharashtra's numbers are typical:

• Late registration: ₹5 a day for PTRC, ₹2 a day for PTEC, from the date you became liable.
• Late payment: interest at 1.25% a month.
• Late return: ₹1,000 per return (₹200 if filed before a notice in some periods).
• Non-payment or short payment: penalty up to 10% of the tax due.
• Giving false information in an application: ₹1,000.

Karnataka charges interest at 1.5% a month and a penalty of up to 50% of the tax for wilful non-payment; West Bengal 1% a month plus a penalty that can equal the tax. Because the amounts are small, owners tend to ignore PT for years and then face a demand covering the whole period with interest, typically when they apply for a licence renewal or a bank loan and the department's system flags the PAN.

PT on the proprietor, partners and directors

The business owner is not exempt because they do not draw a salary. Under the enrolment side of every PT Act, a person engaged in any trade, profession or calling must enrol and pay the annual amount fixed for their category, which is ₹2,500 in almost every state for a business, company, professional or trader with income above the state's threshold.

Who pays depends on structure:

• Proprietorship: the proprietor enrols once and pays ₹2,500 a year. If the proprietor also runs a second business under the same PAN, one enrolment usually covers both, but a second shop in another state needs enrolment there.
• Partnership or LLP: the firm enrols and pays ₹2,500, and in Maharashtra, Karnataka and West Bengal each partner is also expected to enrol individually and pay ₹2,500. Confirm the partner rule for your state, since practice varies.
• Private limited company: the company enrols and pays ₹2,500; each director enrols and pays ₹2,500 (directors drawing salary have it deducted through PTRC instead, so it is not paid twice).
• Freelancer or professional: enrol and pay ₹2,500 a year even with no employees. Doctors, CAs, architects, lawyers and consultants are the "professionals" the tax was named for.

Maharashtra offers a one-time payment scheme under which an enrolled person can pay for five years in advance at a discount; check the portal for the current terms. In states where a new enrolment is made after the start of the year, the first year's amount is usually the full ₹2,500 unless the notification provides for proration.

Worked example: a Surat textile trader with staff in two states

A Surat textile trader runs a proprietorship with a Surat office and a small sales office in Mumbai. Gujarat staff: a manager on ₹35,000, two salespeople on ₹18,000 and an office assistant on ₹11,000. Mumbai staff: one sales executive (male) on ₹28,000 and one accountant (female) on ₹22,000.

Gujarat (slab: nil up to ₹12,000, ₹200 above): manager ₹200, each salesperson ₹200, assistant nil. Monthly PT = ₹600, deposited by the 15th of the next month under the Gujarat PTRC. Annual employee PT = ₹7,200.

Maharashtra: the male sales executive on ₹28,000 pays ₹200 a month and ₹300 in February, ₹2,500 a year. The female accountant on ₹22,000 is within the ₹25,000 exemption for women, so nil. Because last year's Maharashtra PT was far below ₹1,00,000, the trader files one annual PTRC return by 31 March covering ₹2,500 of deductions.

The proprietor's own enrolment: ₹2,500 under the Gujarat PTEC by 30 September, and because he is also carrying on business in Maharashtra, a Maharashtra PTEC of ₹2,500 by 30 June. Total PT cost of doing business across both states: ₹5,000 on the owner plus ₹9,700 deducted from staff, none of which comes out of the business's pocket.

Each Gujarat salary slip shows the ₹200 line under deductions; the accountant's Maharashtra slip shows PT as nil so that she can see the exemption was applied. If the sales executive were to move to the Surat office, his PT would switch to the Gujarat slab from the month he starts working there.

Common mistakes

• Registering for PTRC but never enrolling the business under PTEC, or the reverse. Both are needed in most states.
• Applying the head office state's slab to employees working in another state. PT follows the place of work.
• Missing the February (Maharashtra) or March (Odisha, MP) higher deduction, which is how these states reach the ₹2,500 cap.
• Deducting PT from women in Maharashtra earning up to ₹25,000, or from employees above 60 or 65 in states that exempt them.
• Applying Tamil Nadu and Kerala slabs monthly instead of on half-yearly income.
• Filing annually in Maharashtra when last year's liability crossed ₹1,00,000, which makes you a monthly filer automatically.
• Forgetting PT entirely for the owner of a freelance or consulting practice because "there is no salary".
• Not showing PT on the salary slip, which leaves the employee unable to claim the Section 16(iii) deduction under the old regime.

How VyaparKit helps

VyaparKit's payroll run applies the professional tax slab for the employee's work state, including the higher February and March months where a state uses them, and totals the deduction per state so you have the figure for each portal. Every salary slip shows PT as a separate line, which employees need for their own tax filing. For a single payslip outside a payroll run, the payslip tool does the same. The tools compute and display PT; you still pay it on the state portal.

Next steps

• Check whether each state where your employees work levies PT, and note the slab and due date for each.
• Enrol the business (PTEC or equivalent) and register as employer (PTRC or equivalent) on each state's portal within 30 days of becoming liable.
• Set up the slab in payroll and confirm exemptions for women (Maharashtra), seniors and persons with disabilities.
• Diarise the payment date for each state and the owner's annual enrolment payment.
• Read the EPF guide and ESI guide to complete your monthly deductions, and salary structure basics to design the slip.