Professional Tax Compliance in India: State-wise Rates, Rules, and Risks for startups

Professional tax (PT) is a state-level direct tax that applies to every individual earning income through employment, profession, trade, or calling in an applicable state. Professional Tax compliance for a startup in India means registering as an employer within 30 days of hiring, deducting the correct slab amount each month from every employee’s salary, depositing it with the relevant state authority by the prescribed due date, filing a monthly Form 5A statement, and filing an annual return in Form 5 within 60 days of the financial year end. Miss any one of these steps and you have a compliance gap , and penalties begin accruing from day one. PT sits within a broader set of annual obligations covering MCA filings, income tax, GST compliance, ESIC, and secretarial filings all of which apply to a startup’s annual compliance calendar alongside PT.

What is Professional Tax, and What is its legal basis?

Professional tax is a direct tax imposed by state governments on income earned through salaried employment, self-employed practice, or any trade or calling. It has nothing to do with the profession-specific income that Section 44ADA of the Income Tax Act addresses. The name is historical , the tax applies equally to a software engineer, a doctor, a logistics company director, and a freelance designer, as long as they earn above the threshold set by their state.

The constitutional authority to levy PT sits in Article 276, Clause (2) of the Constitution of India. This clause grants state governments the power to impose and collect professional tax, subject to a hard annual cap of ₹2,500 per person. No state can charge more than this, regardless of how high an individual’s income is. The cap has not been revised since 1988.

PT is a state subject, which means it is governed by separate legislation in each applicable state. Maharashtra operates under the Maharashtra State Tax on Professions, Trades, Callings and Employment Act, 1975. Karnataka operates under the Karnataka Tax on Professions, Trades, Callings and Employment Act, 1976. West Bengal operates under the West Bengal State Tax on Professions, Trades, Callings and Employment Act, 1979. Every applicable state has an equivalent Act. The rules, slab thresholds, return formats, and portal processes differ under each one.

For a startup, this matters because PT liability is determined by the state in which the employee’s workplace is located, not where the company is incorporated or where the employee lives. A Bengaluru-incorporated company with employees working out of Mumbai, Hyderabad, and Kolkata has three separate PT registrations to manage, three sets of due dates, and three state portals to file on.

PTRC vs PTEC , the distinction most founders miss

There are two distinct PT registrations in most states, and confusing them is one of the most common early-stage compliance errors.

Professional Tax Registration Certificate (PTRC) is the employer registration. Any entity , private limited company, LLP, partnership, or sole proprietorship , that employs even one person whose salary exceeds the state’s PT threshold must obtain a PTRC. The PTRC authorises the employer to deduct PT from employee salaries and deposit the collected amount with the state government. The PTRC also triggers the obligation to file periodic returns.

Professional Tax Enrolment Certificate (PTEC) is the individual registration for self-employed professionals, business owners, and company directors. A founder who draws no salary from the company may still be liable for PTEC in applicable states because they are engaged in a profession or trade. Under most state PT Acts, a company itself , as a legal entity , must also obtain a PTEC and pay a flat annual professional tax in the range of ₹2,500 per year.

The practical implication for a startup: the company needs a PTRC (as employer), each working director likely needs a PTEC (as an individual engaged in a profession), and the company as a legal person may need a separate PTEC as well. This means a two-founder startup with five employees hiring in Maharashtra potentially needs three separate PT registrations , PTRC for the company as employer, PTEC for each founder, and PTEC for the company entity. States vary on this, so verify against the specific state Act.

Which states levy Professional Tax(PT) in India?

PT is not a pan-India tax. As of FY 2026-27, 20 states and one union territory levy professional tax. For FY 2026-27 onwards, the count drops to 19 applicable states following Odisha’s abolishment of PT effective 01/04/2026. Hiring employees physically located in a non-PT state creates no PT liability, regardless of where your registered office is.

States and UTs where PT applies (FY 2026-27):

Andhra Pradesh, Assam, Bihar, Gujarat, Jharkhand, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry (UT), Punjab, Sikkim, Tamil Nadu, Telangana, Tripura, West Bengal.

States and UTs where PT does not apply (FY 2026-27):

Arunachal Pradesh, Chandigarh, Chhattisgarh, Dadra and Nagar Haveli, Daman and Diu, Delhi, Goa, Haryana, Himachal Pradesh, Jammu and Kashmir, Ladakh, Lakshadweep, Odisha (PT applicable only up to FY 2025-26), Rajasthan, Uttar Pradesh, Uttarakhand, and all remaining UTs not listed in the applicable states above.

Update:
Odisha PT abolished from 01/04/2026: The Odisha State Tax on Professions, Trades, Callings and Employment (Repeal) Ordinance, 2026 was published in the Odisha Gazette on 21/04/2026, with retrospective effect from 01/04/2026. No PT is payable in Odisha from FY 2026-27 onwards. Employers with Odisha employees must stop deductions from April 2026 salary. Outstanding dues for FY 2025-26 remain payable, and the annual return for FY 2025-26 must still be filed. Odisha moves to the non-applicable list from FY 2026-27.

State-wise PT salary slabs , FY 2026-27

The table below covers all 20 applicable states. Rates are for salaried employees unless noted. Where a state uses a special month (one month with a higher deduction to reach the ₹2,500 annual cap), that is indicated separately. All figures are monthly unless otherwise stated.

State-wise professional tax slab rates, FY 2026-27

State	Monthly salary slab	Monthly PT (₹)	Special month / note
Andhra Pradesh	Up to ₹15,000	Nil	Nil
	₹15,001 to ₹20,000	₹150	Nil
	Above ₹20,000	₹200	Nil
Assam	Up to ₹10,000	Nil	Nil
	₹10,001 to ₹15,000	₹150	Nil
	Above ₹15,000	₹208 (11 months)	₹212 in final month
Bihar	Annual income up to ₹3,00,000	Nil	Annual basis
	₹3,00,001 to ₹5,00,000	₹1,000/year	Nil
	₹5,00,001 to ₹10,00,000	₹2,000/year	Nil
	Above ₹10,00,000	₹2,500/year	Nil
Gujarat	Up to ₹12,000	Nil	Nil
	Above ₹12,000	₹200	Nil
Jharkhand	Up to ₹25,000	Nil	Nil
	Above ₹25,000	₹100	Nil
Karnataka	Up to ₹24,999	Nil	Revised 01/04/2025
	₹25,000 and above	₹200 (11 months)	₹300 in February
Kerala	Up to ₹11,999 (half-yearly)	Nil	Half-yearly basis
	₹12,000 to ₹17,999	₹120 per half-year	Nil
	₹18,000 to ₹29,999	₹180 per half-year	Nil
	₹30,000 to ₹44,999	₹360 per half-year	Nil
	₹45,000 to ₹59,999	₹600 per half-year	Nil
	₹60,000 to ₹74,999	₹750 per half-year	Nil
	₹75,000 and above	₹1,250 per half-year	Max ₹2,500/year
Madhya Pradesh	Up to ₹18,750	Nil	Nil
	₹18,751 to ₹25,000	₹125	Nil
	₹25,001 to ₹33,333	₹166 (11 months)	₹174 in final month
	Above ₹33,333	₹208 (11 months)	₹212 in final month
Maharashtra (male)	Up to ₹7,500	Nil	Nil
	₹7,501 to ₹10,000	₹175	Nil
	Above ₹10,000	₹200 (11 months)	₹300 in February
Maharashtra (female)	Up to ₹25,000	Nil	Fully exempt
	Above ₹25,000	₹200 (11 months)	₹300 in February
Manipur	All slabs	₹208 (11 months)	₹212 in final month
Meghalaya	Up to ₹4,999	Nil	Annual assessment
	₹5,000 to ₹7,499	₹175/year	Nil
	₹7,500 to ₹9,999	₹325/year	Nil
	₹10,000 to ₹14,999	₹975/year	Nil
	₹15,000 and above	₹2,500/year	Nil
Mizoram	Up to ₹5,000	Nil	Nil
	Above ₹5,000	₹208 (11 months)	₹212 in final month
Nagaland	Up to ₹5,000	Nil	Nil
	Above ₹5,000	₹208 (11 months)	₹212 in final month
Puducherry	Up to ₹10,000	Nil	Nil
	₹10,001 to ₹15,000	₹100	Nil
	Above ₹15,000	₹200	Nil
Punjab	Up to ₹24,999	Nil	Nil
	Above ₹25,000	₹200	Nil
Sikkim	Up to ₹20,000	Nil	Nil
	₹20,001 to ₹30,000	₹125	Nil
	₹30,001 to ₹40,000	₹150	Nil
	Above ₹40,000	₹200	Nil
Tamil Nadu	Up to ₹21,000 (half-yearly)	Nil	Half-yearly basis
	₹21,001 to ₹30,000	₹135 per half-year	Nil
	₹30,001 to ₹45,000	₹315 per half-year	Nil
	₹45,001 to ₹60,000	₹690 per half-year	Nil
	₹60,001 to ₹75,000	₹1,025 per half-year	Nil
	Above ₹75,000	₹1,250 per half-year	Max ₹2,500/year
Telangana	Up to ₹15,000	Nil	Nil
	₹15,001 to ₹20,000	₹150	Nil
	Above ₹20,000	₹200	Nil
Tripura	Up to ₹7,500	Nil	Nil
	₹7,501 to ₹15,000	₹100	Nil
	₹15,001 to ₹25,000	₹150	Nil
	Above ₹25,000	₹200	Nil
West Bengal	Up to ₹10,000	Nil	Nil
	₹10,001 to ₹15,000	₹110	Nil
	₹15,001 to ₹25,000	₹130	Nil
	₹25,001 to ₹40,000	₹150	Nil
	Above ₹40,000	₹200	Nil

Note: Slab rates are subject to state government notifications. Karnataka revised its slab with effect from 01/04/2025 under Karnataka Act No. 33 of 2025. Maharashtra’s ₹300 month is February (not March). Karnataka’s ₹300 month is also February. Both states reach the ₹2,500 annual cap via (₹200 x 11 months) + ₹300 in February. Always verify against the current gazette notification of the relevant state before processing payroll.

What PT Compliance actually requires , the full obligation checklist

Professional Tax compliance is not a single action. It is a recurring set of obligations that run every month and culminate in an annual return. Founders who set up PTRC registration and then stop there have completed only the first step. The ongoing compliance lifecycle has five distinct components.

1. Monthly deduction from salary

Each month, when payroll is processed, the employer must calculate the applicable PT for every employee based on their gross monthly salary and the slab applicable in the state where they work. The deduction is made from the employee’s net salary before payment. The employer does not bear this cost , it is the employee’s liability, collected at source by the employer.

2. Payment of PT challan

After deduction, the employer must deposit the collected PT amount with the respective state government by the prescribed due date. This is done via an online PT challan on the state’s commercial tax or professional tax portal. Each state has its own portal. In Maharashtra it is the Mahavat portal. In Karnataka it is the KPTC portal. In West Bengal it is the WBCTD portal. The challan must match the deduction register exactly.

3. Monthly Form 5A statement

In states that require it (Maharashtra is the primary example), the employer must file a monthly statement , Form 5A in Maharashtra , showing the salary paid, PT deducted, and PT deposited for each employee during the month. This is filed online and must be submitted along with proof of payment. The due date for Form 5A is typically the last day of the following month.

4. Quarterly return filing

Several states require employers with fewer than 20 employees to file returns quarterly rather than monthly. The return covers the quarter’s deductions and payments and is filed on the state PT portal. The due date is generally the 15th of the month following the end of the quarter.

5. Annual return in Form 5

Every employer registered under any state’s PT Act must file an annual return after the close of the financial year. The due date varies by state. In Maharashtra, the annual return in Form 5 must be filed within 60 days of the financial year end, i.e., by 31st May. In Karnataka, the annual PT return is due by 30th April of the following financial year. Other states have equivalent forms with their own schedules. The annual return consolidates all monthly deductions, payments, and any adjustments for the full financial year, and must be accompanied by proof of all monthly PT challans for the year.

Failure to file the annual return is a separate offence from failure to make monthly payments. Both attract independent penalties.

Documents required for ongoing PT compliance filing

Registration documents are different from the documents needed for monthly and annual compliance filing. Founders often confuse the two. The following are required for routine PT compliance on an ongoing basis:

• Login credentials for the state’s PT portal (PTRC login)
• Monthly payroll summary showing employee-wise gross salary and PT amount deducted
• KYC records of all employees (PAN card, address proof) , required for first-time filings and any amendments
• Digital Signature Certificate (DSC) of the authorised signatory, in states that require digital authentication
• PT challan copies for the preceding three months (required when filing returns or responding to notices)
• Attendance and salary register, maintained in the prescribed format under the applicable state labour rules

The salary register must reflect PT deductions as a separate line item. During an inspection by the PT authority, this register is the primary evidence of compliance. An employer who has paid PT but maintained no deduction register faces the same evidentiary exposure as one who has not paid at all.

How to register for PT , timelines and process by state type

Every employer must obtain a PTRC before the first salary is processed for an eligible employee. The registration is state-specific and must be completed separately for each state in which the company employs people.

1. Visit the applicable state PT portal (mahagst.gov.in for Maharashtra, pt.kar.nic.in for Karnataka, wbctd.gov.in for West Bengal, ctd.telangana.gov.in for Telangana).
2. Create a new employer account using the company PAN and GSTIN.
3. Fill the PTRC application with entity details, registered office address, number of employees, and salary range.
4. Upload documents: Certificate of Incorporation, PAN, proof of premises, bank details, employee list, and board resolution authorising the signatory.
5. Submit online. A reference number is generated immediately.
6. The PT authority reviews within 3 to 7 working days for major online states. Offline states may require a premises inspection and take up to 30 working days.
7. On approval, the PTRC is issued digitally. The certificate number is required for every challan payment and return filing going forward.

Registration must be completed within 30 days of employing the first employee whose salary crosses the state’s PT threshold. For self-employed professionals and business owners (PTEC), registration must be completed within 30 days of commencing practice or business in the applicable state. Late registration attracts a penalty from the date PT first became applicable, not from the date of application.

Documents required for PTRC registration (employer):

• Certificate of Incorporation (for a private limited company) or LLP Agreement (for an LLP)
• Memorandum and Articles of Association (for companies)
• PAN card of the entity
• PAN cards and address proofs of all directors or partners
• Proof of business premises , lease agreement or own title deed, plus NOC from landlord if rented
• Bank account details, cancelled cheque, and recent bank statement
• List of employees with designation, salary, and date of joining
• Board resolution authorising the signatory (for companies)
• Passport-size photographs of directors

In states with online registration, a provisional PTRC is typically issued within 3 to 7 working days. In offline states, physical inspection of premises may be required before the certificate is issued, which can extend the timeline to 15 to 30 working days. If a startup has offices in multiple states, a separate registration application must be filed with the PT authority of each state. There is no single-window national PT registration process.

PT payment due dates , state-wise rules and the 20-employee threshold

Due dates vary significantly by state. The article’s earlier description of a uniform “15th of the following month” rule does not hold across all states. The correct picture, by state, is set out below.

Table 3: State-wise PT payment due dates for employers

State	Payment frequency	Employer due date
Andhra Pradesh	Monthly	10th of the following month
Assam	Monthly	28th of the following month
Bihar	Annual	30th November
Gujarat	Monthly	15th of the following month
Jharkhand	Annual	31st October
Karnataka	Monthly	20th of the following month
Kerala	Half-yearly	31st August (H1: Apr-Sep) and 28th February (H2: Oct-Mar)
Madhya Pradesh	Monthly	10th of the following month
Maharashtra	Monthly	15th of the following month (per Feb 2026 Rule 11(3) amendment)
Manipur	Annual	30th March
Meghalaya	Monthly	28th of the following month
Mizoram	Annual	30th June
Nagaland	Monthly	28th of the following month
Puducherry	Half-yearly	Last day of each month following the half-year
Punjab	Monthly	15th of the following month
Sikkim	Quarterly	31st July, 31st October, 31st January, 30th April
Tamil Nadu	Half-yearly	30th September (H1: Apr-Sep) and 31st March (H2: Oct-Mar)
Telangana	Monthly	10th of the following month
Tripura	Monthly	15th of the following month
West Bengal	Monthly	21st of the following month

For startups operating across Maharashtra, Karnataka, Telangana, and West Bengal simultaneously, there are four different due dates in any given month: the 10th (Telangana), the 15th (Maharashtra), the 20th (Karnataka), and the 21st (West Bengal). A single payroll team running on one mental model of “file by the 15th” will routinely miss Karnataka and West Bengal.

The 20-employee threshold rule (where applicable)

In states that distinguish between employer size, the threshold is based on employees in that specific state under that specific PTRC. A startup with 25 total employees but only 8 in West Bengal applies the schedule for its West Bengal PTRC independently. The 20-employee threshold is relevant primarily for Maharashtra, where employers with fewer than 20 employees may qualify for annual rather than monthly filing. Check the specific state’s rules, as thresholds and the resulting filing frequency differ.

States with half-yearly cycles

Kerala and Tamil Nadu both calculate PT on a half-yearly basis, meaning the PT amount is based on the six-month gross salary, not the monthly figure. For Tamil Nadu, PT is deducted from the August salary (for the April-September half) and from the January salary (for the October-March half). For Kerala, the deposit deadlines are 31st August and 28th February.

The deduction-vs-deposit trap

There is a legally important distinction between the obligation to deduct and the obligation to deposit. Once PT is deducted from an employee’s salary, it is held by the employer in trust for the state government. Failure to deposit deducted PT, even if the deduction happened correctly and on time, is treated as misappropriation of funds held in trust. In the context of the ESI Act this is explicitly classified as a breach of trust under Section 40(4). Most state PT Acts carry an analogous provision. The consequences of deducting but not depositing are more serious than those of not deducting at all, because the former also implicates criminal liability.

Who is exempt from PT?

Certain categories of individuals are exempted from PT liability under most state PT Acts. The list is broadly consistent across states, though specific states may add or remove categories through notifications.

The following individuals are generally exempt from PT across applicable states:

• Parents or guardians of children with permanent physical disability or mental disability
• Members of the armed forces as defined under the Army Act, 1950, the Air Force Act, 1950, and the Navy Act, 1957, including auxiliary forces personnel and reservists serving in the state
• Badli workers in the textile industry
• Individuals suffering from permanent physical disability including blindness, where the disability reduces their capacity for gainful employment
• Women exclusively engaged as agents under government-notified savings schemes (in states where this exemption exists)
• Parents or guardians of individuals suffering from mental disability
• Individuals above 65 years of age in most states (Karnataka’s exemption applies from age 60, verify state-by-state as the threshold differs)

Exemptions are not automatic. In most states, the employee must submit a declaration to the employer with supporting documentation, and the employer must record this in the salary register and stop deduction going forward. Continuing to deduct PT from an exempt employee creates a refund liability and a potential grievance.

Penalties for PT non-compliance

State PT authorities treat non-compliance seriously. The penalty structure has three tiers, each addressing a distinct type of default.

Tier 1: Failure to register

Every day or month of operating without a valid PTRC or PTEC attracts a penalty. The quantum varies by state , Maharashtra levies a penalty of ₹5 per day of default, Karnataka and West Bengal have their own schedules , but the penalty accrues from the date PT first became applicable, not from the date the authority discovers the default. A startup that hired its first employee in April 2023 and applied for PTRC in January 2025 has accumulated roughly 21 months of daily penalty exposure on the day of application.

Tier 2: Late payment or non-deposit of PT

Delay in depositing PT after deduction attracts interest at 1% to 2% per month on the outstanding amount, depending on the state. West Bengal specifically levies 1% per month interest on late deposits. On top of interest, most states levy a penalty of 10% of the unpaid tax for each period of default. In chronic cases , repeated missed payments over several quarters , the penalty can escalate to 50% or more of the accumulated liability.

Tier 3: Non-filing of returns

Filing returns late or not at all is a separate default from late payment. States typically levy ₹100 to ₹500 per return per day of delay. The annual return (Form 5) carries its own late filing penalty.

Prosecution risk

Where default is wilful or persistent, state PT authorities have the power to file a prosecution case. In serious cases of non-deposition of collected PT, the officials can attach the company’s bank accounts and recover the outstanding amount along with penalty and interest from the assets of the defaulter. Directors of a private limited company can be held personally liable for PT defaults where the company has failed to comply, particularly if they are the authorised signatory under the PTRC.

Treelife has seen PT arrears accumulate to 8x the original tax amount over a 3-year default period, once interest and penalties across multiple states compound.

Can PT be deducted from income tax? Section 16(iii) of the Income Tax Act

PT paid by an employee is fully deductible from gross salary income under Section 16(iii) of the Income Tax Act, 1961. The deduction is available in the financial year in which the PT is actually paid, not in the year for which it was deducted. If PT for March FY 2026-27 is deposited in April FY 2027-28, the deduction is available in FY 2026-27.

For an employee paying the maximum PT of ₹2,500 per year, the actual tax saving depends on their applicable income tax slab. In the 30% slab, the saving is ₹750. In the 20% slab, the saving is ₹500. The deduction appears as a line item in Form 16 under “Tax deducted at source under Section 192” and is separately identified in the salary particulars.

Self-employed professionals who pay PT directly under a PTEC can also claim this deduction. However, the deduction is available only for PT actually paid , it cannot be claimed on the basis of a liability that has not been discharged.

PT compliance risks specific to startups

Multi-state payroll is the biggest compounding risk

A startup that is hiring fast and adding employees in new cities is adding new PT registration obligations with each new state it enters. The obligation kicks in from the date the first employee in that state crosses the salary threshold. There is no grace period. A startup that hires its first Bengaluru employee in April and does not apply for Karnataka PTRC until August has four months of late registration penalty exposure and four months of undeposited PT challan liability.

The risk compounds because each state has a different portal, a different return format, a different due date, and a different payment method. A payroll team managing five states without a dedicated compliance calendar will miss due dates , it is a near-certainty at scale.

Remote work does not change the applicable state

PT liability follows the location of the employee’s workplace, as defined in the employment records. If an employee is officially based in the company’s Mumbai office but works from home in Pune, the employer’s PT obligation is under the Maharashtra PTRC (since both are in Maharashtra). But if the employee officially relocates to Delhi , which is a non-PT state , and the employer updates the records accordingly, PT deduction stops. The key is what the employment record and offer letter say. Informal remote work arrangements that do not update the employee’s official work location create a mismatch between where PT is being filed and where it should be filed.

The director liability exposure

Under most state PT Acts, the authorised signatory named on the PTRC , typically a director , bears personal liability for PT defaults. If the company is wound up with PT arrears outstanding, the state PT authority can pursue the responsible directors personally. This is not a theoretical risk. As investor due diligence for Series A and Series B rounds increasingly includes statutory compliance checks, unresolved PT arrears have surfaced as a closing condition issue in Treelife’s experience.

Payroll tools do not substitute for compliance review

Most payroll software automates PT deduction based on the employee’s home state in the HRMS. Founders who prefer to remove this operational burden entirely can explore payroll outsourcing as a structural fix rather than a workaround. But the software does not verify whether PTRC has been obtained, whether challans are being deposited correctly to the right state, or whether the annual return has been filed. The deduction shown on the payslip and the actual deposit to the state government are two separate events. Founders who check the payslip and assume compliance is done have not completed the loop.

PT compliance calendar for FY 2026-27 , Month-by-month obligations

This is the section most founders ask for and almost no resource publishes accurately. The calendar below covers all recurring PT obligations for a startup operating across major PT states. Due dates are state-specific and differ significantly. Maharashtra’s due date is the 15th of the following month. Karnataka’s is the 20th. West Bengal’s is the 21st. Telangana’s is the 10th. The calendar uses the Maharashtra/Gujarat/Punjab pattern (15th) as the base, and calls out state-specific deviations explicitly.

PT Compliance Calendar, FY 2026-27 (Apr 2026 to Mar 2027)

Month	Action required	Base due date (MH/GJ/PB: 15th following month)	State-specific deviations	Annual obligation
April 2026	Deduct PT from April salary per state slab. Deposit challan to each state’s portal.	15 May 2026	Karnataka: 20 May. West Bengal: 21 May. Telangana/AP: 10 May.	File Form 5 for FY 2025-26 by 31 May 2026 (Maharashtra). Karnataka annual return due 30 April 2026.
May 2026	Deduct PT from May salary. Deposit challan.	15 June 2026	Karnataka: 20 June. West Bengal: 21 June. Telangana/AP: 10 June.
June 2026	Deduct PT from June salary. Deposit challan. Tamil Nadu H1 deduction from June salary. Kerala: H1 deposit due 31 August.	15 July 2026	Karnataka: 20 July. West Bengal: 21 July. Telangana/AP: 10 July.
July 2026	Deduct PT from July salary. Deposit challan.	15 August 2026	Karnataka: 20 Aug. West Bengal: 21 Aug. Telangana/AP: 10 Aug.
August 2026	Deduct PT from August salary. Tamil Nadu H1 PT deducted from August salary and deposited. Kerala H1 deposit deadline: 31 August.	15 September 2026	Karnataka: 20 Sep. West Bengal: 21 Sep. Telangana/AP: 10 Sep. Tamil Nadu H1 deposit due 30 Sep.
September 2026	Deduct PT from September salary. Deposit challan.	15 October 2026	Karnataka: 20 Oct. West Bengal: 21 Oct. Telangana/AP: 10 Oct. Tamil Nadu H1 due 30 Sep (already passed).
October 2026	Deduct PT from October salary. Deposit challan.	15 November 2026	Karnataka: 20 Nov. West Bengal: 21 Nov. Telangana/AP: 10 Nov.
November 2026	Deduct PT from November salary. Deposit challan.	15 December 2026	Karnataka: 20 Dec. West Bengal: 21 Dec. Telangana/AP: 10 Dec.
December 2026	Deduct PT from December salary. Deposit challan.	15 January 2027	Karnataka: 20 Jan. West Bengal: 21 Jan. Telangana/AP: 10 Jan.
January 2027	Deduct PT from January salary. Tamil Nadu H2 PT deducted from January salary. Deposit challan. Kerala H2 deposit deadline: 28 February.	15 February 2027	Karnataka: 20 Feb. West Bengal: 21 Feb. Telangana/AP: 10 Feb. Tamil Nadu H2 deposit due 31 Mar.
February 2027	Deduct PT from February salary. Maharashtra and Karnataka: deduct ₹300 instead of ₹200 this month. Deposit challan. Kerala H2 deadline: 28 February.	15 March 2027	Karnataka: 20 Mar. West Bengal: 21 Mar. Telangana/AP: 10 Mar.
March 2027	Deduct PT from March salary (standard ₹200 across states since February was the ₹300 month). Deposit challan.	15 April 2027	Karnataka: 20 Apr. West Bengal: 21 Apr. Telangana/AP: 10 Apr. Tamil Nadu H2 deposit due 31 Mar.	Karnataka annual return due 30 April 2027. Prepare Form 5 data for Maharashtra FY 2026-27.

Notes on reading this calendar:

Both Maharashtra and Karnataka deduct ₹300 in February (not different months). The annual total for both states works out to (₹200 x 11) + ₹300 = ₹2,500.

Tamil Nadu PT is deducted from employee salaries in August (for the April-September half) and January (for the October-March half). The deposit deadlines are 30th September and 31st March respectively. The slab is calculated on six-month gross salary, not monthly gross. Payroll systems configured for monthly PT will calculate Tamil Nadu incorrectly.

Kerala PT is deposited by 31st August (H1) and 28th February (H2). The slab is also six-month-based.

Maharashtra’s annual return (Form 5) must be filed within 60 days of the financial year end, i.e., by 31st May. Karnataka’s annual PT return is due by 30th April of the following financial year.

Maharashtra’s Form 5A monthly statement must be filed alongside each month’s challan. Per the February 2026 Rule 11(3) amendment to the Maharashtra PT Rules, all PTRC return filing and payment due dates are now aligned to the 15th of the following month.

For startups in multiple states, run this calendar in parallel for each PTRC. Each state’s challan is deposited independently. There is no consolidated multi-state PT payment mechanism.

For a startup operating across Maharashtra, Karnataka, and Telangana, there are 36 monthly challan deposits, 12 Form 5A filings (Maharashtra), and 3 annual returns to manage every financial year, across 3 state portals with 3 separate login credentials. This is the operational reality of multi-state PT compliance.

Treelife practitioner note

PT looks like a small compliance , ₹200 a month, maximum ₹2,500 a year. The reason we spend time on it with every client at incorporation and at every hiring milestone is that the total liability is not ₹2,500. It is ₹2,500 multiplied by every employee, multiplied by every month of non-compliance, plus penalty, plus interest, across every state in which the company employs people.

A startup that has 40 employees across Maharashtra, Karnataka, and Telangana and has missed 18 months of PT compliance has, in rough numbers, a ₹14.4 lakh PT deposit liability before penalties are added. Add Maharashtra’s late payment interest at 1.25% per month and Karnataka’s penalty at 10% of unpaid tax per quarter, and the total exposure can reach ₹20 to ₹22 lakh. That is a meaningful cash flow hit for any Series A company, and it surfaces at the worst possible time , during a funding due diligence exercise.

The fix is straightforward when caught early: apply for backdated registration (most states permit this), compute the arrears, deposit with interest, file the missing returns, and close the gap. When caught during due diligence by an investor’s legal team, it becomes a negotiating issue and occasionally a closing condition. We have seen PT arrears delay a Series A close by six weeks while the company worked through a remediation plan acceptable to the investor.

Register before you hire the first employee in any new state. Set up the challan deposit as a recurring calendar item tied to payroll. File Form 5 by 31st May every year without exception. These three actions eliminate almost all PT compliance risk for a startup.

FAQs on Professional Tax Compliance in India

Q: Does PT compliance apply to a startup that has just incorporated but has no employees yet?
A: No PT registration is required until you hire the first employee whose salary crosses the applicable state threshold. The 30-day registration clock starts from the date of that first hire, not from incorporation.

Q: Does a founder who draws no salary need to register under PT?
A: Possibly. The PTEC obligation in most states applies to any person engaged in a profession, trade, or calling , including a director who is actively managing the business regardless of whether they draw a salary. Check the specific state’s PT Act for the definition of “person liable.” In Maharashtra and Karnataka, working directors are generally liable for PTEC.

Q: What is the due date for paying PT for a startup with 25 employees?
A: For employers with more than 20 employees, PT must be deposited within 15 days of the end of the month. So April’s deductions are due by 15th May. The quarterly schedule (payment by the 15th of the month after the quarter ends) applies only to employers with 20 or fewer employees in the applicable state.

Q: Which month does Karnataka deduct ₹300 instead of ₹200?
A: With effect from 01/04/2025, Karnataka deducts ₹300 in February instead of ₹200, while the remaining 11 months are ₹200 each. Annual total: (₹200 x 11) + ₹300 = ₹2,500.

Q: Does Maharashtra have different PT rates for men and women?
A: Yes. Male employees earning between ₹7,501 and ₹10,000 per month are taxed at ₹175. Female employees earning up to ₹25,000 per month pay nil PT in Maharashtra. This is one of the few gender-differentiated PT structures in India.

Q: Can PT paid be claimed as a deduction in the income tax return?
A: Yes. PT paid by an employee is deductible from gross salary under Section 16(iii) of the Income Tax Act, 1961. The deduction is available in the year of actual payment, not the year of deduction. Maximum claimable is ₹2,500 per year.

Q: What is Form 5 and when must it be filed?
A: Form 5 is the annual PT return filed by employers under the Maharashtra PT Act (and equivalent forms in other states). It must be filed within 60 days of the end of the financial year , by 31st May each year. It consolidates all monthly deductions and deposits for the year. Missing this filing attracts a separate penalty from late payment penalties.

Q: What is Form 5A and is it mandatory?
A: Form 5A is the monthly statement filed by employers under the Maharashtra PT Act along with the monthly challan payment. It details salary paid, PT deducted, and PT deposited for each employee during the month. It is a mandatory compliance step for PTRC holders in Maharashtra and is distinct from the annual Form 5.

Q: Does an employee working from home in Delhi need to pay PT?
A: No. Delhi does not levy professional tax. If an employee is officially recorded as working from Delhi in the employment records, no PT deduction applies, regardless of where the company’s registered office is. PT follows the employee’s recorded workplace state.

Q: What is the penalty for not registering for PT at all?
A: Penalty accrues from the date PT first became applicable (the date of the first eligible hire), not from the date the authority discovers the default. In Maharashtra, the penalty is ₹5 per day. Other states have their own schedules. There is no cap on the total late registration penalty period.

Q: Can the PT authority attach our bank account?
A: Yes. Where a company has failed to deposit collected PT, state PT officials have the power to attach bank accounts and recover outstanding amounts along with penalty and interest. This power is available under most state PT Acts without a court order.

Q: Is PT deductible for self-employed founders who pay it as a PTEC obligation?
A: Yes. PT paid under a PTEC is deductible from income under Section 16(iii). The deduction is available only for the amount actually paid, not for arrears that have been assessed but not yet discharged.

Q: Our payroll software shows PT being deducted. Does that mean we are compliant?
A: Not necessarily. The payroll software records the deduction on the payslip. PT compliance also requires that the deducted amount has been deposited via challan to the correct state authority by the due date, and that the monthly statement (Form 5A in Maharashtra) and annual return (Form 5) have been filed. Deduction alone without deposit is non-compliance , and it is a more serious default because the deducted amount is held in trust for the state.

Q: At what funding stage does PT compliance become a due diligence issue?
A: Series A and beyond, consistently. Investor legal due diligence at Series A routinely checks PTRC status, challan payment history, and annual return filing for all applicable states. Unresolved PT arrears have been a closing condition in transactions Treelife has advised on. Pre-Seed and Seed rounds typically have lighter diligence, but the arrears you accumulate in the early years are exactly what surfaces at Series A.

Regulatory references :

• Article 276, Clause (2), Constitution of India , constitutional authority for state PT levy and ₹2,500 annual cap
• Section 16(iii), Income Tax Act, 1961 , deductibility of PT from gross salary
• Maharashtra State Tax on Professions, Trades, Callings and Employment Act, 1975
• Maharashtra PT Rules, Rule 11(3) amendment (February 2026) , PTRC due date aligned to 15th of following month
• Karnataka Tax on Professions, Trades, Callings and Employment Act, 1976
• Karnataka Tax on Professions, Trades, Callings and Employments (Amendment) Act, 2025 (Karnataka Act No. 33 of 2025), notified in Karnataka Gazette (Extraordinary) on 15/04/2025, effective 01/04/2025
• West Bengal State Tax on Professions, Trades, Callings and Employment Act, 1979
• Andhra Pradesh Tax on Professions, Trades, Callings and Employment Act, 1987
• Telangana Tax on Professions, Trades, Callings and Employment Act, 1987
• Gujarat Panchayats, Municipal Corporations and State Tax on Professions, Trades, Callings and Employments Act, 1976
• Kerala Panchayat Raj Act, 1994 and Kerala Municipality Act, 1994 (PT provisions)
• Tamil Nadu Tax on Professions, Trades, Callings and Employments Act, 1992 and Town Panchayats, Municipalities and Municipal Corporations Rules, 1988 (PT provisions)
• Odisha State Tax on Professions, Trades, Callings and Employment (Repeal) Ordinance, 2026 (Ordinance No. 02 of 2026), published in Odisha Gazette on 21/04/2026, effective 01/04/2026

External sources :

• incometaxindia.gov.in , Section 16 deduction provisions
• mca.gov.in , company and LLP incorporation records referenced for PTRC documentation requirements
• mahavat.gov.in , Maharashtra PT portal
• kptc.kar.nic.in , Karnataka PT portal
• wbctd.gov.in , West Bengal commercial tax portal