Professional Tax in India: Which States Charge It and How Much

The small deduction on your payslip labelled "PT" or "P.Tax" is professional tax. It is levied by the state, not by the Centre, and it is the reason two people on identical CTCs in different cities take home slightly different amounts.

The constitutional cap

Article 276 of the Constitution limits professional tax to ₹2,500 per person per year. No state can charge more, whatever your income.

This makes it one of the few taxes in India with a hard ceiling that does not move with your salary. Someone earning ₹5 lakh and someone earning ₹5 crore in Maharashtra pay the same ₹2,500.

Who charges it

State	Approximate annual maximum
Delhi	Nil
Uttar Pradesh	Nil
Haryana	Nil
Rajasthan	Nil
Maharashtra	₹2,500
Tamil Nadu	₹2,500
Telangana	₹2,500
Andhra Pradesh	₹2,500
Madhya Pradesh	₹2,500
Kerala	₹2,500
Odisha	₹2,500
Bihar	₹2,500
Assam	₹2,500
West Bengal	₹2,496
Karnataka	₹2,400
Gujarat	₹2,400
Punjab	₹2,400

Within each state the amount varies by salary band, with lower earners paying less or nothing. The figures above are the annual maximum, which applies to most full-time salaried professionals.

Because rates and bands are revised in state budgets, treat this as a guide and confirm against your state's own notification if the exact rupee figure matters.

Where you work, not where you are paid

Professional tax follows the state in which you are employed, not where your company is headquartered and not where you live.

Working from an office in Bengaluru for a Delhi-registered company means Karnataka professional tax. This has become a genuine question for remote workers — the general position is that it follows the location of the establishment you are attached to, and employers usually apply the state of the office you report to. If you work permanently from a different state, ask HR how they are treating it.

It is deducted, not paid by you

Your employer deducts it from salary and deposits it with the state. You do not file anything and there is nothing to claim.

It is deducted monthly in most states, typically ₹200 a month. Maharashtra charges ₹300 in February to reach ₹2,500 for the year, which is why one month's payslip looks slightly different.

The deduction that only helps under the old regime

Professional tax paid is deductible from salary income under Section 16(iii) — but only under the old tax regime. Under the new regime the deduction is not available.

At the 30% slab, ₹2,500 of professional tax is worth ₹750 of tax relief under the old regime and nothing under the new one. It is small money either way, but it is one more line in a comparison that has many.

The self-employed pay it too

Professionals — doctors, lawyers, chartered accountants, architects, consultants — and businesses are liable in states that levy it, but they must register and pay directly rather than having it deducted. Registration is with the state commercial tax department, and penalties for non-registration exist and are enforced in some states.

If you have moved from employment to freelancing in a state that levies professional tax, this is an obligation that no longer happens automatically.

Why it matters for a job offer

₹2,500 a year is not going to change your decision. But it is one of the reasons a national "in-hand salary" figure is always slightly wrong, and it compounds with the other state-level differences — rent, cost of living, and whether your city counts as a metro for HRA purposes, which is worth far more.

The in-hand salary calculator applies your state's professional tax alongside PF and income tax so the take-home figure reflects where you actually work.