Professional Tax [Thread 296692] - CiteHR
Sanagapalli
Labour Laws And Financial Matters
+1 Other

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sir
i have a doubt whether the prof tax is deductiable on rate of salry or earning of that month.
ex: x rate of salary is 6000/- but in that month his earnings are Rs 4800/- whether the prof tax is apllicable or not
yvrao

Professional tax will be depending on the net salary .Suppose for Rs . 10,000 I need to deduct Rs. 80 only. If the salary is 15000 according to that slab only we need to deduct the professional tax.


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Thanks & Regards,
Vani

Dear Mr.Rao,

I have pasted details relating to Profession Tax applicable to Chennai. In this it states the Gross Half Yearly income needs to be considered.

The Profession Tax assessment and collection is coming under the provision of tax on professions, trades, calling & employments, under the Tamilnadu Municipal Laws (Second Amendment) Act 1998 Profession Tax is higher source of income next to Property Tax. The Profession Tax assessment is calculated based of the Half Yearly gross income for the following categories.

Individuals

Private Establishment

Salaried People (Central and State Govt.)

Company

Every Company transacts business and every person who is engaged actively or otherwise in any Profession, Trade, Calling and Employment with the Chennai Corporation city limits has to pay half-yearly Profession Tax, as per section 138C of Tamilnadu Municipal Laws Second Amendment Act 59 of 1998. The tax rates are given below in the table in Form-2. for assessment of Profession Tax has to make an application for registration. The Corporation of Chennai will assign a permanent number in the style of PTNAN.

Based on the gross income declared by the Half Yearly Profession Tax will be calculated as per the Table given below:



Sl.No. Average half yearly Income From To Half yearly Profession Tax



1 Upto Rs.21,000/- NIL

2 Rs.21,001,/- to Rs.30,000/- Rs.100/-

3 Rs. 30,001/- to Rs.45,000/-Rs.235/-

4. Rs.45,001/- to Rs.60,000/-Rs.510/-

5 Rs.60,001/- to Rs.75,000/-Rs.760/-

6 Rs. 75,001/- and above - Rs.1095/-



Company Tax

The assessment and collection of Company Tax are coming under the Provisions of tax section 110 and Schedule IV of the C.C.M.C. Act 1919.

If the Council by a resolution determine that a tax on companies shall be levied, every company which, after the date specified in the notice published under sub-section(2) of section 98-A transacts business within the city any half year not less then sixty days with aggregate shall pay, in addition to any licence fee that may be leviable under this Act, a half yearly tax assessed in accordance with the rules Schedule-IV, but in no case exceeding rupees one Thousand.





Assessment of Companies (See section 110)

Companies shall be assessed by the Commissioner on the following scale:



Paid-up capital Lakhs of rupees Half-yearly Tax (Rs.)

A. Less than one Rs.100/-

B. One and more than one, but less than two Rs.200/-

C. Two and more than two, but less than three Rs.300/-

D. Three and more than three, but less than five Rs.400/-

E. Five and more than five, but less than ten Rs.500/-

F. Ten and above Rs.1000/-



Provided that any company, the head or a principal office of which is not in the city and which shows that its gross income received in or from the city in the year immediately preceding the year of taxation:



(a) has not exceeded Rs.5,000 shall pay only 25 rupees per half-year.

(b) has exceeded Rs.5,000 but has not exceeded Rs.10,000 shall pay only 50 rupees per half-year:

(c) has exceeded Rs.10,000 but and has not exceeded Rs.20,000 shall pay only 100 rupees per half-year.

(d) has exceeded Rs.20,000 shall pay per half year 100 rupees together with a sum calculated at the rate of 25 rupees per half year for every 5000 rupees of part thereof of gross income in excess of Rs.20,000 subject to a maximum half-yearly tax of 1,000 rupees.



Provided further that when a company, the head or a principal office of which is not in the city becomes liable to tax for the first time, it shall pay in the first year at tax of 25 rupees; but if the gross income of the company during such year is subsequently found to have exceeded 5,000 rupees, it shall pay the tax calculated in accordance with the above mentioned scale less the initial payment of 25 rupees.



In the event you have any doubts I suggest you can obtain a copy of the Act relating to Profession Tax which will be available in bookstores publishing statutory books.

M.V.KANNAN

Dear All,
We are a company based in Maharashtra and we have a branch office in Jharkhand. We have taken ESIC SUB-CODE at Jharkhand. The salaries are generated from Maharashtra.
Do we have to deduct Professional tax of these employees and if yes, do you have to consider the slab as per Maharashtra or Jharkhand. If Jharkhand, then can someone please provide the Professional Tax Slab for Jharkhand ?
Thanks,

Prof Tax is payable on the net salary drawm only but not on the rate of salary or gross salary. regards sanagapalli
Dear Grettapl,
ESI and Profession tax are two different statutes. For your information Profession tax is a source of revenue for the local Muncipality/ Corporation. ESI is a Central act and is payable for benefits extended.
To answer your query. You are required to deduct Profession tax in the respective place where the employees are working. In your case Jharkand.
M.V.KANNAN

Dear Sir, thanks. I need one more clarification regarding Professional Tax. Is this deducted on Gross or net salary ? What is PT slab for Jharkhand State ? Regards, grettapl
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