Professional tax, and the state that actually applies
A state levy on employment, deducted monthly — where the governing state is the one the employee works in, not the one your head office sits in.
What it is
A state-level tax on employment, deducted by the employer and paid to the state.
How much
Slabs and applicability differ by state; some states do not levy it at all. The annual maximum is ₹2,500.
The trap
Applying the head office state to everyone. PT follows the place of work.
Professional tax is a state-level tax on employment, deducted monthly by the employer and paid to the state. Slabs, ceilings and even applicability differ by state; some states do not levy it at all. The annual maximum is ₹2,500 per person.
How it works in practice
Maharashtra, Karnataka and West Bengal each use different slabs. A company with offices in two states deducts two different amounts for employees on identical salaries.
What to watch for
PT follows the place of work, not the head office. Multi-location companies get this wrong constantly.
How Klok handles it
Klok applies PT by the employee’s workplace state, not the company’s registered address.
Professional Tax (PT) FAQs
We have offices in three states. Do we register in all three?
Where PT applies in each, yes — registration and remittance are state-specific, and one registration does not cover employees working elsewhere.
What about employees working from home in another state?
This is genuinely unsettled in practice and the position varies by state. Where a significant number of employees work from a state you have no presence in, it is worth taking local advice rather than assuming the office state governs.
Is PT deductible for income tax?
Yes — professional tax paid is allowable as a deduction from salary income, so it should flow through to the TDS computation rather than sitting only on the payslip.
We have staff working from home in another state. Which state's PT applies?
It follows the workplace, not the head office and not the payroll location. Remote staff in a PT state can create a registration obligation there — one of the quieter costs of distributed hiring.
Is professional tax the same everywhere in India?
No. It is a state levy, so slabs, due dates and even whether it exists at all vary. Applying one state's slab across a multi-state payroll is a recurring source of shortfall.
Is PT deducted from every employee?
It applies by wage slab, so lower-paid employees may fall outside it entirely in some states. Deducting a flat amount from everyone is both wrong and easy to spot in an audit.
Who bears professional tax, employer or employee?
Ordinarily it is deducted from the employee and deposited by the employer, and some states levy a separate amount on the employer as an entity. The two are distinct obligations and both need tracking.
Stop calculating this by hand
Klok computes it from your own attendance and salary data, every month, with the working shown.