Remember that your calculation and payment will need to be certified by a registered chartered accountant. Additional read: What every business owner needs to know about professional tax. Money in bank in 24 hours Apply now. Views Share. What is professional tax? Nil Over 5 years For professionals such as legal practitioners, CA, architects, etc. Apply for a Business Loan. Yes No. Thank you sharing your feedback. How would you rate this article. What did you dislike?
Yes, Professional Tax is applicable even for professionals, if income exceeds the specified limit as per your Professional Tax Laws applicable in the state where you live. Thank you for your response.
Are you a salaried employee? Download link sent. How to check if your Form 16 carries a valid digital signature. What is the difference between Assessment Year and Financial Year? How is take home different from CTC? Upload your Form Annual — Professional tax is deducted once in a year, and the computation spans the twelve payroll periods. Exemptions — Some states exempt certain categories of employees from paying professional tax. For example, in Karnataka, the following categories of employees are exempt from professional tax:.
Professional tax slabs — Employee salaries fall within different salary ranges or slabs, and the amount of professional tax to be paid depends on the salary range to which the employee belongs. Every state specifies its own salary slabs and the professional tax rate that is applicable for a salary range.
The system calculates the professional tax amount accordingly. Arrears or the retrospective professional tax — When arrears are paid to an employee, the system determines the professional tax amount to be paid for previous periods by performing retrospective calculation.
The system computes the retrospective professional tax in two ways, and the method it uses depends on the state. The two methods are:. Gross Carry Forward — The system recalculates the professional tax basis for the past periods.
It carries forward the difference in the professional tax basis for each retrospective calculation period into the current processing period, and sums it up into the current processing period. Deduction Carry Forward — The system recalculates the professional tax amount for the past periods. It carries forward the difference in the professional tax amount for every retrospective period into the current processing period, and then sums it up for the current processing period.
When there is a retrospective change of state, or a change in the professional tax liability of an employee, the system always uses the deduction carry forward method for retrospective professional tax computations. Reports — The system generates professional tax statements in a format prescribed by the concerned state authorities. Hence, before attempting to a professional tax, it is advisable to check with the professional tax experts.
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