Professional tax slab applicable ? urgent

This query is : Resolved

Hiral N Mehta (Querist)
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06 October 2015 Our company has now opted for payment of salary from head office and thus making it centralized. Now the question here is whether the professional tax slab as per the state in which company is situated or tax slab in which the employees is working, is applicable. e.g. head office is in Gujarat, and branch offices at Tamilnadu, Madhya Pradesh etc.

There is conflict in opinion kindly experts if you can advise as soon as possible.

Hiral N Mehta

Hiral N Mehta (Querist)
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06 October 2015 Experts plz reply . Please.

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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10 August 2024 In India, the applicability of Professional Tax (PT) is primarily based on the location where the employees are working, not the location of the company's head office. Here’s how you should approach this situation:

### **1. **State-Specific Professional Tax Slabs:**

- **Professional Tax Payment Responsibility:**
- **For Employees Working in Different States:** The PT liability is based on the state where the employees are physically working. Therefore, if you have employees working in different states, you need to follow the PT slabs and regulations applicable to each state where the employees are stationed.

- **Example Scenarios:**
- **Gujarat Head Office, Employees in Tamil Nadu and Madhya Pradesh:**
- For employees working in Tamil Nadu, you should follow Tamil Nadu's PT slabs and regulations.
- For employees working in Madhya Pradesh, follow the PT slabs and regulations applicable in Madhya Pradesh.

### **2. **Compliance for Centralized Payment:**

- **Multiple State Registrations:**
- You may need to have separate Professional Tax registrations in each state where your employees are working, even if the payment is centralized at the head office.

- **Payment and Filing:**
- Ensure that PT is deducted and paid according to the slab rates of each state, and file returns as per the local regulations of those states.

### **3. **Steps to Ensure Compliance:**

1. **Determine Employee Locations:**
- Identify the states where your employees are based and working.

2. **Review PT Slabs for Each State:**
- Obtain and review the PT slab rates for each state where your employees are working. This information is generally available on the official state government websites or from local tax consultants.

3. **Register in Each State:**
- If required, register for Professional Tax in each state where you have employees.

4. **Deduct and Pay PT According to State Regulations:**
- Deduct PT based on the applicable slab for the state in which the employee is working and ensure timely payment to the respective state authorities.

5. **File Returns as Required:**
- File PT returns as per the requirements of each state where PT is applicable.

### **Summary:**

- **PT is governed by the state in which employees are physically working,** not the location of the head office.
- Ensure compliance with each state’s PT regulations where your employees are based, including registration, deduction, payment, and filing of returns.

If you need more specific details or face any challenges with multi-state compliance, consulting with a tax professional or legal advisor who specializes in state tax laws can provide personalized guidance.

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