Professional tax explained
Updated 11 October 2026
Professional tax is a small tax that some state governments charge on salaries, professions and businesses. Your employer deducts it from your salary every month and pays it to the state. The Constitution caps it at ₹2,500 a year, so most salaried people pay ₹200 a month or less, and states like Delhi, Haryana, Rajasthan and Uttar Pradesh do not levy it on salaries at all.
How professional tax works
- Who sets it: each state, under Article 276 of the Constitution, which limits the total to ₹2,500 per person per year.
- Who pays: salaried employees (deducted by the employer) and self-employed professionals and businesses (who pay it directly).
- Based on: monthly gross salary in most states; half-yearly salary in Tamil Nadu and Kerala.
- Which state: the state where you work, not where you live.
Professional tax slabs in major states
These are the commonly applied salary slabs. States revise them from time to time, so treat this as a guide and check your state's latest notification or your payslip.
| State | Salary (monthly unless stated) | Professional tax |
|---|---|---|
| Maharashtra | Up to ₹7,500 / ₹7,501 to ₹10,000 / above ₹10,000 | Nil / ₹175 a month / ₹200 a month (₹300 in February), total ₹2,500 a year. Women have a higher exemption limit. |
| Karnataka | Below ₹25,000 / ₹25,000 and above | Nil / ₹200 a month. Reports say a 2025 amendment allows ₹300 in February, taking the year to ₹2,500. |
| West Bengal | Up to ₹10,000 / ₹10,001 to ₹15,000 / ₹15,001 to ₹25,000 / ₹25,001 to ₹40,000 / above ₹40,000 | Nil / ₹110 / ₹130 / ₹150 / ₹200 a month |
| Tamil Nadu: Chennai (half-yearly salary) | Up to ₹21,000 / ₹21,001 to ₹30,000 / ₹30,001 to ₹45,000 / ₹45,001 to ₹60,000 / ₹60,001 to ₹75,000 / above ₹75,000 | Nil / ₹180 / ₹425 / ₹930 / ₹1,025 / ₹1,250 per half-year, from 1 October 2024. Each Tamil Nadu local body sets its own rates, so other towns may differ. |
| Gujarat | Below ₹12,000 / ₹12,000 and above | Nil / ₹200 a month |
| Telangana and Andhra Pradesh | Up to ₹15,000 / ₹15,001 to ₹20,000 / above ₹20,000 | Nil / ₹150 / ₹200 a month |
| Delhi, Haryana, Rajasthan, Uttar Pradesh | Any | No professional tax on salaries |
Other states that levy it, such as Madhya Pradesh, Kerala, Odisha and Assam, have their own slabs. Some states also exempt senior citizens, people with disabilities and certain other groups.
Worked example
Professional tax and income tax
- Old regime: professional tax you pay is deductible from salary income. This was section 16(iii) of the old Act and is now in section 19 of the Income-tax Act, 2025.
- New regime: no deduction for professional tax. Only the ₹75,000 standard deduction and a few others are allowed.
- In the old regime, deducting ₹2,500 saves ₹520 in tax at the 20% slab (₹500 plus 4% cess) and ₹780 at the 30% slab.
Compare both regimes in the income tax calculator, and see old vs new tax regime.
Changing jobs or working in two states
- Professional tax is charged by the state where you work. If you move from Bengaluru to Delhi mid-year, deductions stop once you are on a Delhi payroll.
- If you change jobs within the same state, the new employer may deduct again in the month you join. The yearly limit of ₹2,500 still applies, so give the new employer details of what was already deducted if the total would cross it.
- The amount deducted appears in Part B of Form 16. Use that figure if you claim the deduction in the old regime.
For employers and the self-employed
- Employers in states that levy professional tax must register, deduct it from salaries and deposit it with the state by the due dates, which differ by state. Late payment attracts interest and penalties.
- Self-employed professionals such as doctors, lawyers and consultants, and many businesses, pay a fixed yearly amount directly, usually through the state's commercial tax portal.
Professional tax is part of what separates CTC from take-home pay. See CTC vs in-hand salary and the salary calculator, which lets you pick your state.