Professional tax (PT) is a tax on professions, trades, callings and employment, collected by states. Article 276(2) of the Constitution caps the total any one person can be charged at ₹2,500 per year. Within that cap each state sets its own slabs, exemptions, due dates and forms.
Which states levy it
States that levy PT include Maharashtra, Karnataka, West Bengal, Tamil Nadu, Gujarat, Andhra Pradesh, Telangana, Kerala, Madhya Pradesh, Odisha, Assam and several north-eastern states, among others. Delhi, Uttar Pradesh, Haryana and Rajasthan are among those that do not. Lists and slabs change; confirm on the state's commercial taxes or finance department portal.
Two registrations
- Enrolment (often called PTEC) — the business pays PT on its own account.
- Registration (often called PTRC) — the employer deducts PT from employees' salaries and deposits it.
Names differ by state, but most states separate the two.
Deducting it correctly
- Determine the state in which each employee works.
- Apply that state's monthly slab to the employee's salary. Some states vary the amount in one month (for example, a higher February deduction) so the annual total reaches the cap exactly.
- Apply exemptions the state allows — commonly for persons with disability, senior citizens or certain categories of women employees, depending on the state.
- Deposit and file on the state's schedule (monthly, quarterly or annually, often depending on the amount).
The remote-work problem
PT follows the place of employment. When an employee in a Bengaluru-registered company works permanently from Pune, which state's PT applies is a question to settle with your adviser — and the answer depends on a correct "work location" field in the employee record. Keep that field current when people relocate.
PT and income tax
PT paid by a salaried employee has historically been deductible from salary income under the old tax regime; under the default new regime most deductions are not available. Check the current position on the Income Tax Department's site.
Sources and review date
Facts in this article were checked against the official sources below as of 8 October 2026. Rates, wage ceilings, due dates and forms change by notification, so confirm on the source before acting.
- State commercial tax / finance department portals for each state where you employ staff
- Constitution of India, Article 276 (India Code)
- Income Tax Department (incometaxindia.gov.in)
This is a general explainer written by the Kyrospect editorial team, not legal, tax or payroll advice. Applicability depends on your state, headcount, establishment type and contracts — confirm with a qualified professional or the authority concerned.
Where Kyrospect fits: Kyrospect HRMS holds employee records and Tracking records shift hours on the same identity. It does not calculate or file PF, ESI, professional tax, TDS or gratuity today — payroll is planned and gated on statutory compliance work. See the roadmap for current status.