Understanding Professional Tax: Does an Advance Diwali Bonus Affect Deductions?

Dear All,

Please help me out with this query: if an employee's salary is 25,000/- (Male) and we are issuing him Diwali bonus in advance (separately) before his salary, will the professional tax be deducted?

Regards,
Dhanashree

Dear Dhanashree,

Can you please explain the term "Processing Tax" elaboration can make us understand the question & so that to answer the query

Never heard of such a tax! I am afraid if the HRD Ministry official on this site picks up a clue and introduces this type of tax. We already have enough taxes to burden us! I sincerely hope it's the Professional Tax that is misspelled. Regards

Apologies for the posting. Actually, my colleague raised the question, and I was not aware of the term "processing tax" (which, I now know, doesn't exist). She later clarified that she was referring to Professional Tax, which I then explained to her. This confusion was simply due to miscommunication. I sincerely apologize for any inconvenience caused. Thank you.

How to fill profession tax returns? What is the procedure for payment of profession tax deducted from the salary of employees to the government? What are the due dates for filing profession tax returns?

Thank you.

First, you need to apply for a PT Number & Registration. It takes a couple of months to get the number, depending on the state you are applying in. Once you get the PT Number, you can get the Professional Tax Challan from any Stationery Shop or download it from the net or from the official state govt tax sites. Fill the Challan. You can pay it Monthly, Quarterly, Half-yearly, or Annually. You need to fill the totals according to the PT Slabs for your state. Please check the PT Slabs for your state by searching on this site itself or on the net. A cheque drawn in favor of SBI along with the challan needs to be deposited at the bank. There is a lot of information available on Cite HR on PT, which you can go through as a guide on the same... regards

I think it is professional tax.

Professional tax calculation purposes "salary or wages" include pay, wages, dearness allowances, and all other remuneration received by any assessee on a regular basis, whether payable in cash or kind. It also includes perquisites and profits in lieu of salary as defined in section 17 of the Income-tax Act, 1961. However, it does not include bonuses in any form or on any account or gratuity.

Therefore, Professional Tax is not applicable on bonuses.

Why is Paid Professional Tax compulsory? Professional Tax benefits the taxpayer or workers.

Subhash
+919922209111

I am afraid to hear this...any kind of procession will be taxed henceforth? ;)

Regards,
Parul

Can anyone tell me when can we apply for the NSE certifications like derivatives, capital markets, etc.

Please explain the current Minimum Wages Act (July 2010 to December 2010) of the Factory Act. There are two rates mentioned, and I cannot understand them. Could you please explain?

Thanks & Regards,
Sandip Surve

Dear Dhanashree,

Since you are from Pune, Maharashtra, the professional tax rates are as follows:

1. Up to 5000: Nil
2. When salary/wages exceed 5000/-: 175/- per month
3. When salary/wages exceed 10000/-: 200/- per month and 300/- for the 12th month to complete the maximum professional tax of Rs. 2500/- yearly.

Therefore, an employee earning more than 10000/- is liable to pay 2500/- during the accounting year. However, note that if in some months, due to absenteeism, the salary or wages drop down between 5000 to 10000, then the deduction will be 175/-. If it drops below 5000, there will be no deduction.

I hope you understand this.

KIRAN KALE

Dhanashree,

Mr. Ravikaran is absolutely correct. Please go through the appropriate state PT rules for reference.

Please go ahead.

Galfar

Professional tax slab in Karnataka:

Gross 10000/- to 14999/- = Rs. 150/- per person.
Gross 15000/- and above = Rs. 200/- per person.
This professional tax differs from state to state.
This is a mandatory deduction.

Can you explain the current minimum wages under the Factory Act? There are two types of special allowances, and we could not understand.