Which states levy professional tax in India?

Professional tax is levied by Andhra Pradesh, Karnataka, Maharashtra, Tamil Nadu, Telangana, Gujarat, West Bengal, Madhya Pradesh, Assam, Kerala, Meghalaya, Odisha, Tripura, Bihar, Jharkhand, and Sikkim. Union territories and some states like Delhi, Haryana, Punjab, Rajasthan, Uttar Pradesh do not levy professional tax.

What is the maximum professional tax per year?

The maximum professional tax per financial year is Rs 2,500 as per Article 276 of the Constitution of India. This is the upper limit set by the Constitution. Individual states have their own slab rates within this limit. Karnataka is Rs 2,400, Maharashtra is Rs 2,500, Tamil Nadu is Rs 2,185, Andhra Pradesh is Rs 2,080, Telangana is Rs 2,080, Gujarat is Rs 1,200, West Bengal is Rs 2,500.

Who is exempt from paying professional tax?

Exemptions vary by state but typically include: individuals earning below the threshold (e.g., below Rs 15,000/month in Karnataka, Rs 7,500/month in Maharashtra), senior citizens, physically disabled persons, women in some states, parents of children with disabilities, and defence personnel in some states. Check your specific state rules.

How is professional tax deducted from salary?

Employers deduct professional tax from the employee's monthly salary and deposit it with the state government. The deduction happens at source, similar to TDS. The employer is responsible for registration and timely payment to the state tax department, typically on a monthly or annual basis depending on the state.

Is professional tax applicable on pension income?

Professional tax is generally not applicable on pension income since pensioners are not engaged in any profession, employment, or trade. However, if a pensioner takes up re-employment or consultancy work, professional tax may apply on that income.

Is professional tax applicable for freelancers and self-employed?

Yes, freelancers and self-employed professionals are liable to pay professional tax in states where it is applicable. They must register themselves with the state commercial tax department and pay the tax directly. The rates and slabs are different from salaried employees in some states.

What happens if an employee works in a different state than the employer?

Professional tax is typically deducted based on the state where the employee works (the place of posting), not where the employer is headquartered. If the employee works in Karnataka but the company is registered in Maharashtra, Karnataka PT rules apply. If the employee works from home in a state without PT, no PT is deducted.

What is the penalty for non-payment of professional tax?

Penalties for non-payment vary by state. Generally, late payment attracts interest of 1-2% per month, and non-registration can result in a penalty of Rs 5,000 to Rs 10,000. Employers who fail to deduct or deposit PT on time face higher penalties, including potential legal action under state tax laws.

What is the professional tax for Karnataka for 2025-26?

Karnataka has three slabs: up to Rs 15,000/month salary has nil PT, Rs 15,001 to Rs 25,000 has Rs 150/month (Rs 1,800/year), above Rs 25,000 has Rs 200/month (Rs 2,400/year). The annual maximum is Rs 2,400.

What is the professional tax for Maharashtra for 2025-26?

Maharashtra has multiple slabs. For salaried employees earning above Rs 10,000/month, the professional tax is Rs 200/month (Rs 2,500/year). Those earning below Rs 10,000/month pay Rs 175/month in the first 6 months and Rs 200/month thereafter. Some categories like women and senior citizens may have different rules.

Professional Tax Calculator: State-Wise PT Calculator | Fermor

What Is Professional Tax?

Professional tax is a state-level tax levied by state governments on individuals earning income through employment, profession, trade, or calling. The maximum professional tax payable in any state is Rs 2,500 per year, as per Article 276 of the Constitution of India.

Professional tax is collected by the Commercial Tax Department of each state. Employers deduct it from employee salaries and deposit it with the state government. The tax applies to salaried employees, professionals (lawyers, doctors, chartered accountants), and business owners in states where it is levied.

Unlike income tax which is collected by the central government, professional tax is a state subject. This means each state sets its own slab rates and collection rules, within the constitutional cap of Rs 2,500 per year. Some states do not levy professional tax at all, including Delhi, Haryana, Punjab, Rajasthan, and Uttar Pradesh.

Professional Tax by State

Professional tax rates vary significantly across Indian states. The table below shows monthly and annual professional tax amounts for each levying state at a monthly salary of Rs 50,000.

State	Monthly PT (Rs)	Annual PT (Rs)	Slab Basis
Karnataka	200	2,400	Above Rs 25,000/month
Maharashtra	200	2,500	Above Rs 10,000/month
Tamil Nadu	182	2,185	Above Rs 15,000/month
Andhra Pradesh	173	2,080	Above Rs 20,000/month
Telangana	173	2,080	Above Rs 20,000/month
Gujarat	100	1,200	Above Rs 12,000/month
West Bengal	210	2,500	Above Rs 35,000/month
Madhya Pradesh	175	2,100	Above Rs 20,000/month
Assam	150	1,800	Above Rs 10,000/month
Kerala	125	1,500	Above Rs 15,000/month
Odisha	100	1,200	Flat for all earners
Bihar	83	1,000	Above Rs 10,000/month
Jharkhand	150	1,800	Above Rs 10,000/month

Professional tax is not levied in Delhi, Haryana, Punjab, Rajasthan, Uttar Pradesh, Uttarakhand, Himachal Pradesh, Jammu and Kashmir, and all union territories. If you work from home in a non-PT state, no professional tax is deducted even if your employer is based in a PT-levying state.

How Professional Tax Is Calculated

Professional tax is calculated based on the slab system defined by each state government. Your monthly gross salary determines which slab applies, and the corresponding PT amount is deducted every month.

Monthly PT = Slab Amount (based on monthly salary and state rules)
Annual PT = Monthly PT × 12
Deduction under Section 16(iii) = Annual PT (deducted from gross salary)

Worked example: Monthly salary Rs 50,000 in Karnataka. The slab for above Rs 25,000/month is Rs 200/month. Annual PT = Rs 200 × 12 = Rs 2,400. The effective tax rate is (Rs 2,400 / Rs 6,00,000) × 100 = 0.40% of annual salary. Under Section 16(iii), the full Rs 2,400 is deductible from gross salary for income tax purposes.

Use the In-Hand Salary Calculator to see how professional tax affects your take-home pay alongside other deductions.

Professional Tax Exemptions

Professional tax exemptions vary by state, but common exempt categories include:

Common professional tax exemptions across states
Exemption Category	Typical Condition	Applicable States
Low Income Threshold	Salary below state-specific limit (e.g., Rs 15,000/month in Karnataka)	All PT-levying states
Senior Citizens	Above 60 or 65 years depending on state	Maharashtra, Karnataka, Tamil Nadu, Gujarat, West Bengal
Physically Disabled	Permanent disability above 40-60%	Most PT states
Women	May be exempt in specific slabs or entirely	Gujarat (women in certain categories), Tamil Nadu
Defence Personnel	Armed forces personnel	Karnataka, Maharashtra, West Bengal
Parents of Disabled Children	Child with permanent disability	Tamil Nadu, Karnataka
Pensioners	No active employment or trade	All states (generally)

Check your state's commercial tax department website for the exact exemption criteria applicable to your situation. Exemption rules change periodically through state budget announcements.

Tax Benefits Under Section 16(iii)

Professional tax paid during the financial year is deductible from gross salary income under Section 16(iii) of the Income Tax Act, 1961. This deduction is available under both the old and new tax regimes.

How it works: The amount of professional tax paid during the year is subtracted from your gross salary before arriving at your net taxable salary. For example, if your annual gross salary is Rs 8,00,000 and you paid Rs 2,400 in professional tax, your taxable salary reduces to Rs 7,97,600.

Unlike many other deductions, Section 16(iii) has no upper limit. You can deduct the actual professional tax paid, up to the constitutional maximum of Rs 2,500 per year. This makes it one of the simplest deductions to claim since it requires no separate investment or documentation beyond your salary slip.

Compare how PT deductions affect your overall tax liability using the Old vs New Tax Regime Calculator.

How to Use This Professional Tax Calculator

Enter your salary and select your state to see your professional tax liability in three simple steps:

Enter your monthly gross salary: Move the slider or type your monthly gross salary. The calculator works for any salary from Rs 0 to Rs 5,00,000 per month.
Select your state: Choose the state where you work from the dropdown. The calculator applies the correct slab rates for your state. The tool covers all 14 states that levy professional tax.
View your professional tax breakdown: The results show your monthly PT, annual PT, effective tax rate, and the Section 16(iii) deduction available on your income tax return.

Use the currency selector to view results in USD, EUR, GBP, or other currencies. This is useful if you want to compare professional tax costs in terms of other currencies for international tax planning.

Frequently Asked Questions

Professional tax is a state-level tax levied on individuals earning income through employment, profession, or trade. It is collected by the state government and the rate varies by state. The maximum professional tax payable in any state is Rs 2,500 per year as per Article 276 of the Constitution of India.

Disclaimer: Professional tax rates shown on this page are based on current state government regulations and may change after state budget announcements. The calculator provides indicative amounts only. Actual professional tax liability depends on your specific state, salary, and applicable exemptions. Consult a qualified tax professional for advice specific to your situation. For official information, refer to your state's commercial tax department website.