Can you tell me if the profession tax is applicable for basic or gross salary? We are considering whether profession tax on basic salary is correct or incorrect.
Furthermore, my salary structure is as follows:
- Basic
- House Rent Allowances
- Medical Allowances
- Seniority Allowances
- City Compensatory Allowances
Are the above allowances applicable for profession tax? Please explain to me according to income tax rules.
I am awaiting your reply.
Thanks,
From India, Pune
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1Furthermore, my salary structure is as follows:
- Basic
- House Rent Allowances
- Medical Allowances
- Seniority Allowances
- City Compensatory Allowances
Are the above allowances applicable for profession tax? Please explain to me according to income tax rules.
I am awaiting your reply.
Thanks,
From India, Pune
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Dear Dilip,
Professional tax is always state-specific, and the definition of salary or wages may vary from state to state. On a general basis, the definition includes pay, dearness allowance, and all other remunerations, including allowances received by any person on a regular basis, whether payable in cash or kind. It also encompasses perquisites and profits in lieu of salary as defined in Section 17 of the Income Tax Act, 1961 (No. 43 of 1961), but excludes bonus in any form and on any account, gratuity, and pension.
Based on this, all the components of the salary structure defined by you are paid to the employees on a regular basis. Therefore, professional tax shall be levied on the gross salary and not just on the Basic.
I hope your query is clear. Please revert for any clarification.
Adv. Naveen Bhardwaj
9871158855
From India, Delhi
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Professional tax is always state-specific, and the definition of salary or wages may vary from state to state. On a general basis, the definition includes pay, dearness allowance, and all other remunerations, including allowances received by any person on a regular basis, whether payable in cash or kind. It also encompasses perquisites and profits in lieu of salary as defined in Section 17 of the Income Tax Act, 1961 (No. 43 of 1961), but excludes bonus in any form and on any account, gratuity, and pension.
Based on this, all the components of the salary structure defined by you are paid to the employees on a regular basis. Therefore, professional tax shall be levied on the gross salary and not just on the Basic.
I hope your query is clear. Please revert for any clarification.
Adv. Naveen Bhardwaj
9871158855
From India, Delhi
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Professional tax depends on state & the slab of wages. The wages in PF includes all salary components. regards Amit
From India, New Delhi
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From India, New Delhi
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Professional tax is levied on gross salary, not on basic salary. The new slab is as follows: PT is Rs.150 for gross salary of Rs.10,000 & above and Rs.200 for Rs.15,000 and above. The professional tax rates vary depending on the states.
Regards, Satish
From India, Bangalore
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Regards, Satish
From India, Bangalore
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Hi, Can anyone please explain that why salary split-up is done Eg: Basic House Rent Allowances Medical Allowances DA What is the benefit of having salary structure. Thanks & Regards cgnanij
From India, Madras
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From India, Madras
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can i know at a present profession tax ? profession tax and I T TAX DIFFRENCE? WHAT IS T.D.S ........... WHAT IS METHODS?
From India, Bangalore
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From India, Bangalore
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Dear All,
Can you all help me out with this problem? Actually, I have no idea regarding TDS deduction on salary. Please tell me how it is applicable according to the slab wise or state wise, and also explain the method.
Thank you.
From India, Mohali
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Can you all help me out with this problem? Actually, I have no idea regarding TDS deduction on salary. Please tell me how it is applicable according to the slab wise or state wise, and also explain the method.
Thank you.
From India, Mohali
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Hi all,
I have a query. I am working with a CA firm in Gujarat, and they pay salaries by cheques to the employees. Currently, there are no deductions from the salary for the approximately 20 employees. I would like to know the details of the following:
1. There is no salary structure like basic, HRA, DA, PF, etc. Is it important to have a structure and deduct PF? If not done, could there be any legal actions or difficulties?
2. No professional tax is being paid. Is it compulsory to pay, and if yes, how should I start?
3. Does having a proper salary structure help employees save on income tax?
Please reply. I am confused and cannot find the right direction.
Regards,
Kirty
From India, Mumbai
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I have a query. I am working with a CA firm in Gujarat, and they pay salaries by cheques to the employees. Currently, there are no deductions from the salary for the approximately 20 employees. I would like to know the details of the following:
1. There is no salary structure like basic, HRA, DA, PF, etc. Is it important to have a structure and deduct PF? If not done, could there be any legal actions or difficulties?
2. No professional tax is being paid. Is it compulsory to pay, and if yes, how should I start?
3. Does having a proper salary structure help employees save on income tax?
Please reply. I am confused and cannot find the right direction.
Regards,
Kirty
From India, Mumbai
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Dear all, Please let me know , What is criteria of ESIC deduction & components are include in earning salary . Regards Sandeep Kumar
From India, Mohali
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From India, Mohali
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Hi Kirti If in your company more then 20 employees are working so u people have to apply for PF & ESIC. Profession tax is compulsory to deduct fromevery employees and u have to pay pt every year.
From India
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From India
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Hi Sandeep,
The ESIC criteria is INR 15,000. If an employee's salary is INR 15,000 or less, they have to pay ESIC. It has been heard that from April, the criteria will become INR 25,000. ESIC is deductible from the Gross Salary.
From India
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The ESIC criteria is INR 15,000. If an employee's salary is INR 15,000 or less, they have to pay ESIC. It has been heard that from April, the criteria will become INR 25,000. ESIC is deductible from the Gross Salary.
From India
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Dear All,
Salary breakup is necessary for an organization and employees to avail tax benefits under the Income Tax Act. The CTC is divided into the following components:
1. Gross Salary
a) Basic Salary
b) DA
c) HRA
d) Conveyance
e) Special Allowance
2. Contribution
a) PF Contribution
b) ESIC Contribution
3. Reimbursements (Examples)
a) Medical Allowance
b) Leave Travel Allowance (LTA)
c) Petrol
d) Vehicle Maintenance
e) Driver Salary
The CTC breakup will vary from company to company and is based on income tax savings for employees. Salary breakup is crucial for any organization and its employees since some statutory claims are calculated based on specific salary components rather than the total CTC amount. For example, PF is calculated on Basic Salary and Dearness Allowances, ESIC is based on Gross Salary, and PT is determined by Gross Salary.
According to income tax regulations, certain allowances are exempt from tax, such as HRA, Conveyance, Medical Allowance, LTA, and some Special Allowances (Uniform Allowance, Driver Salary, Helper Allowance, etc.).
Your faithfully,
[Your Name]
From India, Hyderabad
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Salary breakup is necessary for an organization and employees to avail tax benefits under the Income Tax Act. The CTC is divided into the following components:
1. Gross Salary
a) Basic Salary
b) DA
c) HRA
d) Conveyance
e) Special Allowance
2. Contribution
a) PF Contribution
b) ESIC Contribution
3. Reimbursements (Examples)
a) Medical Allowance
b) Leave Travel Allowance (LTA)
c) Petrol
d) Vehicle Maintenance
e) Driver Salary
The CTC breakup will vary from company to company and is based on income tax savings for employees. Salary breakup is crucial for any organization and its employees since some statutory claims are calculated based on specific salary components rather than the total CTC amount. For example, PF is calculated on Basic Salary and Dearness Allowances, ESIC is based on Gross Salary, and PT is determined by Gross Salary.
According to income tax regulations, certain allowances are exempt from tax, such as HRA, Conveyance, Medical Allowance, LTA, and some Special Allowances (Uniform Allowance, Driver Salary, Helper Allowance, etc.).
Your faithfully,
[Your Name]
From India, Hyderabad
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Hi all,
Professional tax should be deducted from the Gross salary. However, in our case, LTA is being added to the Gross salary, and Night Shift allowance is being deducted from the Gross salary for the purpose of PT calculation. Could you please confirm if this calculation is correct?
If only regular pay is supposed to be added to the Gross salary, then why is LTA being considered for PT calculation? Please provide clarification.
Thank you.
From India, Tirumala - Tirupati
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Professional tax should be deducted from the Gross salary. However, in our case, LTA is being added to the Gross salary, and Night Shift allowance is being deducted from the Gross salary for the purpose of PT calculation. Could you please confirm if this calculation is correct?
If only regular pay is supposed to be added to the Gross salary, then why is LTA being considered for PT calculation? Please provide clarification.
Thank you.
From India, Tirumala - Tirupati
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Hi Dilip,
The Professional Tax is a source of revenue for the state governments which helps in implementing schemes for the welfare and development of the region. Professional Tax is deducted by the employers from the salary of the salaried employees and is deposited with the state government. Other individuals pay it directly to the government or through the local bodies appointed to do so.
The respective state governments in India levy the professional tax on income from the profession or employment. Professionals earning an income from salary or other practices such as a lawyer, teacher, doctor, chartered accountant, etc., are required to pay professional tax. In the case of salaried and wage earners, the professional tax is liable to be deducted by the employer from the salary/wages and the same is to be deposited to the state government. In the case of other classes of individuals, this tax is liable to be paid by the employee himself. The tax calculation and the amount collected may vary from one state to another, but it has a maximum limit of INR 2500/- per year.
You can refer to the following link for more information on Professional Tax applicable states, not applicable states, exemption: Profession Tax Slabs India - greytHR Admin Guide - Greytip Documentation
From India, Gurgaon
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The Professional Tax is a source of revenue for the state governments which helps in implementing schemes for the welfare and development of the region. Professional Tax is deducted by the employers from the salary of the salaried employees and is deposited with the state government. Other individuals pay it directly to the government or through the local bodies appointed to do so.
The respective state governments in India levy the professional tax on income from the profession or employment. Professionals earning an income from salary or other practices such as a lawyer, teacher, doctor, chartered accountant, etc., are required to pay professional tax. In the case of salaried and wage earners, the professional tax is liable to be deducted by the employer from the salary/wages and the same is to be deposited to the state government. In the case of other classes of individuals, this tax is liable to be paid by the employee himself. The tax calculation and the amount collected may vary from one state to another, but it has a maximum limit of INR 2500/- per year.
You can refer to the following link for more information on Professional Tax applicable states, not applicable states, exemption: Profession Tax Slabs India - greytHR Admin Guide - Greytip Documentation
From India, Gurgaon
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SALARY CALCULATOR & INCOME TAX.zip
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