Professional Tax (PT) is a state-level tax levied by the Kerala government on individuals engaged in employment, trade, profession or calling. It is the employer's responsibility to deduct PT from employee salaries and remit it to the government. This guide covers everything about Professional Tax in Kerala for 2025.
Who is Liable to Pay Professional Tax in Kerala?
- Salaried employees earning above the applicable salary threshold
- Self-employed individuals, professionals (doctors, lawyers, CAs, engineers, etc.)
- Companies and firms enrolled under the Kerala State Tax on Professions, Trades, Callings and Employments Act 1975
Professional Tax Slab Rates in Kerala (2025)
Kerala's PT slabs are as follows (monthly salary basis):
- Up to ₹11,999: NIL
- ₹12,000 to ₹17,999: ₹120 per month
- ₹18,000 to ₹29,999: ₹180 per month
- ₹30,000 to ₹44,999: ₹300 per month
- ₹45,000 to ₹59,999: ₹380 per month
- ₹60,000 to ₹74,999: ₹490 per month
- ₹75,000 to ₹99,999: ₹630 per month
- ₹1,00,000 and above: ₹1,560 per month
Note: The maximum Professional Tax across all states in India is capped at ₹2,500 per annum under Article 276 of the Constitution.
Employer Obligations
Enrolment Certificate: Every employer who employs persons in Kerala must obtain an Enrolment Certificate from the PT authority (Commercial Tax Department, Kerala). Application is made to the Deputy Commissioner of Taxes in the respective district.
Monthly Deduction and Payment: The employer must deduct the applicable PT from each employee's salary every month and remit the total amount to the PT authority by the 15th of the following month.
Annual Return: An annual return must be filed with the PT authority by 31 March each year, reconciling all PT deductions and payments made during the year.
PT Deduction Under Income Tax
Professional Tax paid by an employee is deductible from their taxable income under Section 16(iii) of the Income Tax Act. The PT deducted by the employer from the employee's salary is also deductible as a business expense for the employer.
Penalties for Non-Compliance
Failure to register, deduct or remit Professional Tax attracts penalties under the Kerala PT Act — including interest on delayed payments and compounding fees. Regular inspection of employers' records is conducted by PT officers.
Conclusion
Professional Tax compliance is a recurring monthly obligation for all employers in Kerala. SPOTON's payroll compliance team handles PT registration, monthly deductions, payments and annual returns for businesses across Kerala. Contact us for comprehensive payroll compliance services.
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