Understanding Professional Tax: When Should Our Company Start Deductions?

Hello HR Gurus! I'm working with a small software development company. From October, we want to implement a salary structure. I want to know if our company has registered for P.T. in the month of September. So, from when onwards is the company liable to deduct P.T. from the salary of employees? Secondly, is it required to deduct the P.T. for all those months, i.e., from April to August, for which salary was paid without any Profession Tax deduction? Please shed light on this query. It is really urgent as I have to talk with the management about the same. Waiting for the inputs.................. Regards, Revathi

Dear Revathy,

From day one of your company's inception, you have been required to pay the Professional Tax. If you have not yet deducted it from the employees, kindly do so now and settle any pending dues for the previous periods with a marginal penalty of 1%.

For the period of April to September, the payment should be made to the corporation authorities by the 15th of September, with an unofficial deadline of the 30th of September. Similarly, for the period of October to March, payment is due by the 15th of March, with an unofficial deadline of the 31st of March.

In addition to Professional Tax (P.T.), the company is also obligated to pay company tax based on the paid-up capital of the company, ranging from Rs. 200 to Rs. 1000. The company's contribution to P.T. amounts to Rs. 810 for each period (April-September & October-March).

Regarding employees' P.T. contributions, the slabs are as follows based on the total gross salary for the half-yearly period:
- Up to Rs. 21,000: Nil
- Rs. 21,001 to Rs. 30,000: Rs. 75
- Rs. 30,001 to Rs. 45,000: Rs. 188
- Rs. 45,001 to Rs. 60,000: Rs. 390
- Rs. 60,001 to Rs. 75,000: Rs. 585
- Rs. 75,001 and above: Rs. 810

Regards,
S. Kumarasubramanian

Hi Revathi,

It is better to consult with the PT authority. Go to the Professional Tax department and discuss your query there, definitely they will guide you because rules differ from one state to another.

Mahesh

Hi,

The half-yearly tax has been revised with effect from 01.10.2008 (II half-year of 2008-2009) by the Corporation of Chennai as follows:

Average Half-Yearly Income: Half-year Tax
Up to Rs. 21,000/- NIL
Rs. 21,001/- to Rs. 30,000 Rs. 100/-
Rs. 30,001/- to Rs. 45,000 Rs. 235/-
Rs. 45,001/- to Rs. 60,000 Rs. 510/-
Rs. 60,001/- to Rs. 75,000/- Rs. 760/-
Rs. 75,001/- and above Rs. 1,095/-

Please correct me if I am wrong.

Regards,
erv