Quick answer: Professional tax (PT) is a tax that states charge on employment, professions and trades. For employees, the employer deducts a fixed amount from gross salary each month, usually up to ₹200, and deposits it with the state. The total cannot exceed ₹2,500 a year under Article 276(2) of the Constitution. Slabs, exemptions and due dates differ by state, and some states, including Delhi, Haryana, Uttar Pradesh and Rajasthan, do not levy it at all.
Professional tax is one of the smallest deductions on a payslip and one of the most confusing, because every state runs it differently: different salary limits, different months, different certificates and different due dates. This guide explains what professional tax is, who pays it, how much, which states levy it, how employers register, pay and file returns, the penalties for getting it wrong, and how PT interacts with income tax. For the exact slab in your state, use the professional tax calculator, which lists every state's 2026-27 slab.
What is professional tax?
Professional tax is a direct tax levied by a state government on anyone who earns a living from an employment, profession, trade or calling in that state. Despite the name, it is not limited to professionals such as doctors or lawyers: salaried employees pay it too. Each state that levies it has its own Act, for example the Maharashtra State Tax on Professions, Trades, Callings and Employments Act, 1975 and the Karnataka Tax on Professions, Trades, Callings and Employments Act, 1976.
States get the power to levy it from Entry 60 of the State List (List II) of the Constitution, and Article 276(2) caps the total that any one person can be charged by a state and its local bodies at ₹2,500 a year. That cap is why professional tax is small and why some states deduct a higher amount in one month (Constitution of India).
What is PT in my salary?
On your payslip, "PT", "P Tax" or "Professional Tax" is the amount your employer deducted that month under your state's slab. It is worked out on your gross salary, not on basic pay or on wages as defined in the Labour Codes, and it is a fixed amount for the slab, not a percentage. Our salary slip guide explains every other line on the payslip.
Why is professional tax deducted from salary?
Because the state law makes the employer responsible for collecting it. An employer that pays salaries in a state that levies PT must register, deduct the tax from each employee earning above the state's limit, and deposit it with the state. If it fails to deduct, the employer can be made to pay the tax itself, with interest and penalty. The money goes to the state government or, in Kerala and Tamil Nadu, to the local body.
How much is professional tax?
Professional tax is a fixed amount that depends on which slab your monthly (or half-yearly, or annual) gross salary falls into. Most monthly states charge nothing up to a limit, then one or more fixed amounts above it. Some examples for 2026-27, taken from our calculator:
| State | PT starts | Top rate | Basis |
|---|---|---|---|
| Maharashtra | Above ₹7,500 a month (women: above ₹25,000) | ₹200 a month, ₹300 in February | Monthly |
| Karnataka | At ₹25,000 a month | ₹200 a month, ₹300 in February | Monthly |
| West Bengal (from 1 Oct 2026) | Above ₹20,000 a month | ₹208 a month | Monthly |
| Telangana, Andhra Pradesh | Above ₹15,000 a month | ₹200 a month | Monthly |
| Gujarat | Above ₹12,000 a month | ₹200 a month | Monthly |
| Tamil Nadu (Chennai) | Above ₹21,000 a half-year | ₹1,250 a half-year | Half-yearly |
| Bihar | Above ₹3 lakh a year | ₹2,500 a year | Annual |
So the answer to "how much is PT?" for most salaried employees above the limit is ₹200 a month, or ₹2,400–₹2,500 a year. The professional tax calculator has the full slab for all 19 levying states, plus Punjab's State Development Tax, including the lower slabs, and highlights yours.
How to calculate professional tax
- Find the state where the employee works; if it does not levy PT, the answer is nil.
- Take the gross salary for the state's period: monthly in most states, half-yearly in Kerala and Tamil Nadu, annual in states such as Bihar.
- Read the fixed amount for that salary from the state's slab.
- Apply any top-up month: in Maharashtra and Karnataka, ₹300 is deducted in February instead of ₹200.
- Check for an exemption, such as a disability certificate, before deducting.
Example: a gross of ₹48,000 a month in Karnataka is above ₹25,000, so PT is ₹200 a month and ₹300 in February, ₹2,500 for the year. The calculator does this for any state.
Which states levy professional tax?
19 states and union territories levy it on salary, including Maharashtra, Karnataka, West Bengal, Tamil Nadu, Telangana, Andhra Pradesh, Gujarat, Kerala, Madhya Pradesh, Assam and Bihar.
No professional tax on salary: Delhi, Haryana, Rajasthan, Uttar Pradesh, Uttarakhand, Himachal Pradesh, Jammu & Kashmir and Ladakh, Arunachal Pradesh, Goa, Chandigarh, Chhattisgarh, the island union territories, Dadra & Nagar Haveli and Daman & Diu, and, from 1 April 2026, Odisha, which repealed its professional tax. Punjab does not call it professional tax but charges a separate State Development Tax of ₹200 a month on those whose income is above the income-tax exemption limit.
Two recent changes matter for payroll: West Bengal introduced a new schedule from 1 October 2026, raising the exemption limit to ₹20,000 a month, and Odisha stopped professional tax from April 2026 salaries. The calculator's "changes" section tracks these as they happen.
Who pays professional tax?
Liability follows the person, not just the employer. The main groups are:
| Who | How they pay | Typical amount |
|---|---|---|
| Salaried employees above the state's limit | Deducted from salary by the employer every month (or half-year) | Up to ₹2,500 a year, by slab |
| Companies and other businesses | Pay for themselves under an enrolment certificate, once a year | Often ₹2,500 a year |
| Directors | Pay for themselves under an enrolment certificate | Often ₹2,500 a year |
| Self-employed professionals (doctors, lawyers, CAs, consultants) | Pay for themselves under an enrolment certificate | Often ₹2,500 a year, sometimes after a period of standing in the profession |
| Traders and GST-registered dealers | Pay for themselves under an enrolment certificate | By turnover or a flat rate, depending on the state |
The amounts in the last four rows come from each state's schedule; in Maharashtra, for example, companies and directors are each charged ₹2,500 a year under the official rate schedule. An employer company therefore usually pays PT twice over: its own ₹2,500 as a business, and the amounts it deducts from employees' salaries.
Who is exempt from professional tax?
Exemptions are set by each state, but the same categories recur. Maharashtra's list, for example, includes senior citizens aged 65 or over, persons with a disability of 40% or more, parents of children with a physical or mental disability, members of the armed forces, and badli workers in the textile industry. Many states also exempt members of the armed forces and persons with disabilities. An employee claiming an exemption usually gives the employer the supporting certificate so that nothing is deducted.
Separately, employees below the state's salary limit pay nothing, and in Maharashtra women earning up to ₹25,000 a month are exempt.
Professional tax registration: RC and EC
Most states use two certificates, and they are easily confused:
| Registration certificate (RC / PTRC) | Enrolment certificate (EC / PTEC) | |
|---|---|---|
| Who needs it | Every employer that pays salaries above the state's limit | Every person liable to pay PT on their own account: companies, firms, directors, professionals, traders |
| What it covers | Tax deducted from employees' salaries | The holder's own professional tax |
| Payment | Monthly, half-yearly or annual, with returns | Usually once a year, often with no return |
"PTRC" and "PTEC" are Maharashtra's names; Karnataka and West Bengal use RC and EC. An employer company normally holds both. Registration is online on the state's portal, for example MahaGST in Maharashtra and ptax.karnataka.gov.in in Karnataka, with the PAN, address proof, details of the establishment and its employees. Apply within the time the state allows after becoming liable; late registration can attract a penalty.
An employer with staff in several states registers separately in each levying state where its employees work, and in some states for each place of business. PT is deducted under the slab of the state where the employee works, not where the company's head office is.
How employers deduct and pay professional tax
- Find the state of work for each employee and the slab that applies.
- Apply the slab to gross salary for the month (or half-year), and note any exemption certificate.
- Deduct PT in payroll and show it on the payslip.
- Deposit it with the state by the due date, online on the state portal.
- File the return for the period, where the state requires one.
- Report it in Form 130 (formerly Form 16), so the employee can claim it under the old tax regime.
Worked example: one employer, three states
A company pays October 2026 salaries to three employees: Asha in Bengaluru on a gross of ₹48,000, Rahul in Kolkata on ₹18,000, and Neha in Gurugram on ₹60,000.
| Employee | State of work | Gross | PT for October | Why |
|---|---|---|---|---|
| Asha | Karnataka | ₹48,000 | ₹200 | ₹25,000 and above: ₹200 (₹300 in February) |
| Rahul | West Bengal | ₹18,000 | Nil | Up to ₹20,000 is exempt under the schedule from 1 October 2026 |
| Neha | Haryana | ₹60,000 | Nil | Haryana does not levy professional tax |
The company deposits Asha's ₹200 under its Karnataka registration by 20 November. It needs a West Bengal registration once any employee there earns above ₹20,000; Rahul is below the limit, so nothing is deducted for him this month. The company also pays its own enrolment tax in each state where it is enrolled. Neha's state has no PT, so nothing is filed for her.
What is PT paid by an employee, and does it apply to everyone?
The employee's PT is simply the slab amount for their gross salary in the state where they work. It applies to permanent, contract, fixed-term and probationary employees alike, because the test is salary, not type of employment. For interns and trainees paid a stipend, check the state's definitions before deducting. If an employee moves to another state mid-year, the new state's slab applies from the month they start working there; because Article 276(2) caps what any one state can charge, an employee who moves can pay some PT in both states in the same year.
PT sits alongside PF, ESI and TDS in the monthly payroll cycle; our payroll process guide shows where each deposit falls.
When should PT be paid? Due dates in major states
Due dates are set by each state's Act and rules and change from time to time. The table shows the position in the main payroll states as at November 2026:
| State | Employer (tax deducted from salary) | Enrolment holders (own tax) |
|---|---|---|
| Maharashtra | 15th of the following month for monthly filers; 15 March for annual filers | 15 June |
| Karnataka | 20th of the following month | 30 April |
| West Bengal | 21st of the following month; annual return by 30 April | 31 July |
| Telangana, Andhra Pradesh | 10th of the following month | As per the state rules |
| Gujarat | 15th of the following month (quarterly filers: 15th after the quarter) | As per the state rules |
| Tamil Nadu, Kerala | Half-yearly, to the local body (Tamil Nadu: by 30 September and 31 March; Kerala: by 31 August and end of February) | As per the local body |
Maharashtra moved its dates to the 15th by a notification of 28 February 2026 amending Rule 11(3); the MahaGST portal confirms the 15 March date for 2025-26 returns. In Maharashtra, whether an employer files monthly or once a year depends on its PT liability in the previous year.
Can we pay professional tax annually?
Employees cannot choose: the employer deducts PT on the state's schedule. Enrolment holders usually pay once a year anyway, and some states allow more: Maharashtra lets an enrolment holder paying ₹2,500 a year clear five years in advance by paying four years' tax, and Punjab's State Development Tax can be paid as a lump sum of ₹2,200 a year by 30 April.
Professional tax returns
Registered employers file a return showing the employees, salaries and tax deducted for the period: monthly or annually in Maharashtra (Form III-B), monthly in Karnataka (Form 5-A), annually in West Bengal (Form III), and so on. Enrolment holders generally only pay, without filing a return, though a few states require one. Returns are filed on the same portal used for payment, and a nil return may still be required for a period with no deduction.
Penalties for late payment or non-compliance
States charge interest on late payment and can levy penalties, and some also charge a late fee for returns. Examples:
- Maharashtra: a late fee under section 6(3) of the Act of ₹200 for a return filed up to 30 days late and ₹1,000 after that (see the state's trade circular of 17 April 2026), plus interest on late payment.
- Karnataka: interest of 1.25% a month on late payment and a penalty of up to 50% of the tax are commonly reported.
- Failure to deduct: in most states the employer becomes liable for the tax it should have deducted, with interest and penalty.
Because PT amounts are small, the penalties often exceed the tax itself, so it pays to check slabs whenever a state changes them.
Professional tax and income tax
Professional tax paid on salary is deductible from salary income under section 19 of the Income-tax Act, 2025 (section 16(iii) of the 1961 Act) under the old tax regime only (Income Tax Department); the default new regime under section 202 does not allow it. Your employer shows PT in Form 130 (formerly Form 16), and our income tax calculator compares both regimes with the PT deduction.
| Professional tax | Income tax | |
|---|---|---|
| Levied by | State governments (local bodies in some states) | Central government |
| Amount | Fixed by slab, up to ₹2,500 a year | Percentage of taxable income by slab |
| Deducted from salary as | PT | TDS |
| Applies in | Only the states that levy it | All of India |
PT is also separate from the labour welfare fund, another small state deduction; see the labour welfare fund calculator. To see PT alongside PF, ESI and TDS on your salary, read our guide to gross vs net salary.
Related reading: Professional tax calculator · ESI guide · EPF guide · Payroll in India
Run PT and every other deduction correctly. The Practical Payroll Management e-Book covers professional tax, PF, ESI and TDS with worked payroll examples.
Frequently asked questions
Is professional tax compulsory?
Yes, where your state levies it and your salary is above the state's exemption limit. Your employer must deduct it from your salary and deposit it, and you cannot opt out. If you work in a state that does not levy professional tax, such as Delhi or Haryana, nothing is deducted.
What is ₹200 professional tax?
₹200 a month is the top monthly rate in most states that levy professional tax. Because the total cannot exceed ₹2,500 a year, Maharashtra and Karnataka deduct ₹300 in February to make 11 × ₹200 + ₹300 = ₹2,500. In Andhra Pradesh and Telangana, ₹200 a month comes to ₹2,400 a year.
Is professional tax paid monthly or yearly?
It depends on the state. Most states deduct it monthly from salary; Kerala and Tamil Nadu levy it half-yearly through local bodies; Bihar, Jharkhand, Madhya Pradesh, Manipur and Meghalaya fix it on annual salary, and employers usually spread it over the year. Businesses and self-employed people with an enrolment certificate usually pay once a year.
What is the salary limit for professional tax?
There is no national limit; each state sets the salary up to which no professional tax is charged. For example, Karnataka charges nothing below ₹25,000 a month, West Bengal nothing up to ₹20,000 a month from 1 October 2026, and Andhra Pradesh and Telangana nothing up to ₹15,000 a month.
Can professional tax be refunded?
Professional tax correctly deducted is not refundable, because it is a tax, not a deposit. If too much was deducted, for example ₹300 in a month when your slab was ₹200, ask your employer to correct it; tax already paid to the state in excess is claimed through that state's refund procedure.
Who is exempt from professional tax?
It depends on the state. Common exemptions include members of the armed forces, persons with a disability of 40% or more, parents of children with a disability, and senior citizens aged 65 or over in some states. Employees whose salary is below the state's limit pay nothing.
Position as of 14 November 2026. Based on Article 276 of the Constitution, the state professional tax Acts, rules and schedules, state department notices, and the Income-tax Act, 2025. Slabs, exemptions and due dates are set by each state and can change by notification, so check your state's portal. General information, not legal or tax advice.