How to Handle Professional Tax Deductions for Mid-Month Job Changes in Maharashtra?

Dear All,

If someone joins in the middle of the month, what should be his professional tax deduction? For example, an employee works for company A until February 14 and is paid Rs 15,000 as half-month salary for February. He then joins company B on the 15th of February and is paid Rs 20,000 as half-month salary.

So, what should be his Professional Tax deduction? His earlier employer would deduct Rs 300 as Professional tax, while his next employer would also deduct Rs 300 as Professional tax. This occurs because the salary is not processed until the end of the month.

Can someone shed light on how such situations should be handled? There will be many variations to this case. I have taken Maharashtra state for the calculation of Professional Tax.

Thanks

Really nice question. I also want the answer to this question.

Another question is, do we have to deduct Rs. 2500 per year from employee wages under Maharashtra PT? If a deduction of Rs. 200 every month is acceptable, should Rs. 300 be deducted in February or March?

Regards,
Prashant Patil

Hi All,

Rs. 300/- should be deducted in February only.

Another thing I would like to know in detail is about deducting professional tax for employees who join in the middle of the year. Can anybody help?

Thanks,
Raju Antony

Professional Tax Deduction in Maharashtra

Why is professional tax deducted Rs. 300 in the month of February in Maharashtra state? And how is it calculated?

Regards,
HR_Praveen

I have a query regarding professional tax. Please provide me with the ceiling of professional tax. Furthermore, I would like to know if this deduction is made monthly from the salary or on a yearly basis.

I am also calculating the salary after TDS. If anyone can assist me with this, I would greatly appreciate it.

Thanks in advance.

With Regards,
Ritu

Professional Tax and Its Deduction

Professional tax cannot be pro-rated, as it is not deducted on an attendance basis. Rather, it is dependent purely on the gross salary for a given month. In Maharashtra, Rs. 300/- is deducted in February, making it Rs. 2,500/- for the whole year.

In the case mentioned by Pappilon, both companies will deduct Rs. 300/- each from their respective payrolls. Thus, the total deduction becomes Rs. 2,600/- for the entire year. There is no apparent problem in this, as the profession tax paid is admissible as a deduction from tax. Hence, the entire amount of Rs. 2,600/- will be exempted from tax for him.

I have a query: an employee joins on the 10th of February. His salary is 8000 Rs per month. His salary for 16 days amounts to 5565 Rs. I am unsure about the Professional Tax (PT) deduction from his salary. Will it be 175 Rs, or will it be 0 Rs? I am referring to the Maharashtra state PT slab. Please reply promptly; it's urgent.

PT is deducted on the earned amount, not on a gross slab basis.

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