The profession tax is a direct tax imposed on those who earn an income by practicing, working, calling, or trading. Unlike income tax, which is levied by the Central Government, profession tax is levied by the government of a state or union territory in India. Most of the Indian states impose it, but not all. The professional tax is applicable in states like Karnataka and Maharashtra, but not in Delhi and Haryana.
There are some states that charge a percentage of the profession tax, while others tend to charge a fixed amount based on income slabs. Since this is a state-based tax, the rate varies from state to state. A few key states in India have the following professional tax rates:
| State | Income per Month | Tax Rate/Tax Amount (p.m.) |
| Andhra Pradesh | Less than Rs. 15,000 | Nil |
| Rs. 15,000 to less than Rs. 20,000 | Rs. 150 | |
| Rs. 20,000 and above | Rs. 200 | |
| Gujarat | Up to Rs. 5999 | Nil |
| Rs. 6000 to Rs. 8999 | Rs. 80 | |
| Rs. 9000 to Rs. 11999 | Rs. 150 | |
| Rs 12000 and above | Rs. 200 | |
| Karnataka | Up to Rs. 15,000 | Nil |
| Rs. 15,001 onwards | Rs. 200 | |
| Kerala (Half yearly income slabs and half-yearly tax payment) | Up to Rs.11,999 | Nil |
| Rs.12,000 to Rs.17,999 | Rs.120 | |
| Rs.18,000 to Rs. 29,999 | Rs.180 | |
| Rs.30,000 to Rs. 44,999 | Rs.300 | |
| Rs.45,000 to Rs. 59,999 | Rs.450 | |
| Rs.60,000 to Rs. 74,999 | Rs.600 | |
| Rs.75,000 to Rs. 99,999 | Rs.750 | |
| Rs.1,00,000 to Rs. 1,24,999 | Rs.1000 | |
| Rs.1,25,000 onwards | Rs.1250 | |
| Maharashtra | Up to Rs. 7,500 | Nil (for male) |
| Up to Rs. 10,000 | Nil (for female) | |
| From Rs. 7,500 to Rs. 10,000 | Rs. 175 (for male) | |
| Rs. 10,000 onwards | Rs. 200 for 11 months + Rs. 300 for 12th month | |
| Telangana | Up to Rs. 15,000 | Nil |
| Rs.15,001 to Rs.20,000 | Rs. 150 | |
| Rs.20,001 onwards | Rs.200 | |
| Up to 5 years (For professionals such as legal practitioners, CA, architects, etc.) | Nil | |
| Over 5 years (For professionals such as legal practitioners, CA, architects, etc.) | Rs. 2,500 (per annum) | |
| West Bengal | Up to 10,000 | Nil |
| 10,001 to 15,000 | Rs. 110 | |
| 15,001 to 25,000 | Rs. 130 | |
| 25,001 to 40,000 | Rs. 150 | |
| 40,001 and above | Rs. 200 |
Profession Tax Applicability
Persons who are subject to professional tax include:
- A person
- HUFs are Hindu undivided families
- Corporation/Firm/Co-operative Society/Association of persons or a group of individuals, whether or not incorporated
Who Pays Profession Tax?
In the case of self-employed individuals who carry on their trade or profession independently and are subject to profession tax, the state government requires them to pay the tax themselves. A state or union territory’s Commercial Taxes Department is the nodal agency for collecting profession tax based on predetermined tax slabs, which vary from state to state. Individuals pay either an annual or a monthly tax based on their annual taxable income. Taxpayers who are self-employed must obtain a Certificate of Enrollment from a prescribed authority (of the concerned state).
The employer, however, must deduct professional tax from a salaried employee’s salary on a monthly basis (based on the applicable professional tax slab) and deposit it with the state government in the case of salaried and wage earners. If the employer wishes to deposit the deducted profession tax, it must obtain a Certificate of Registration from the relevant authority.
Frequently Asked Questions For Professional Tax
1. Is there a professional tax in India?
Persons’ professions, trades, and employment are taxed
2. What is gross income?
A gross income is a total amount a person earns in a year before taxes and deductions. For example, even though your monthly salary is * 30,000, you only receive a check for * 25,000. Consequently, your net income would be * 25,000, but your gross income would be * 30,000.
3. In India, how much income tax is there on a * 24 lakh salary?
Getting in touch with your personal advisor will help you determine the taxability of your income.
Read More :