Securing Hannav Ledger...
Securing Hannav Ledger...
Glossary
Professional tax is a state-level tax on salaried individuals, professionals, and traders, deducted by employers and remitted to state government.
Professional tax is a small monthly deduction from salary — max ₹2,500 per year — that goes to your state government.
Article 276 of Constitution empowers states. Slabs vary by state — Maharashtra, Karnataka, West Bengal among implementing states. Employer registration mandatory. Allowed as deduction from salary income under Section 16(iii). Not applicable in all states.
Maharashtra employee earning ₹25,000/month pays ₹200 professional tax monthly (₹2,400/year), deducted in salary slip and shown in Form 16.
No. Separate state levy with low cap. Deductible from salary income when computing income tax.
Self-employed professionals register and pay directly to state if applicable in their state of practice.
Constitutional cap ₹2,500 per annum. State slabs determine actual amount within this limit.