Profession Tax (PT) is a tax that the State Governments of India impose on salaried individuals working in government or non-government organizations, or if they are professionals like Chartered Accountants, Doctors, Lawyers, etc. Different states have different rates and methods of collection. PT is a source of revenue for the State Governments that is used to implement schemes for the respective state’s welfare and development.
The slabs for PT, differs from state to state and are updated regularly. The latest change has been made for the state of West Bengal. The PT slabs for West Bengal, have undergone certain changes w.e.f 1 Aug, 2016. The tax rate for employees with monthly salary ranging from Rs. 8,500, to Rs. 10,000, has been reduced from Rs. 90 to ‘Nil’. The rest of the slabs remain unchanged.
It is the duty of every employer to collect this tax from its employee and deposit the total amount with the municipal corporation. The employer deducts it from the salary of the employee every month. Hence, employers in West Bengal have to consider these new changes in the PT slabs while processing the salary of the employees. Considering that the changes have been effective since 1 Aug, 2016, employers in West Bengal must consider the following points while processing the salary for the month of August:
- Salary for the month of August must be processed based on the new changes
in the PT slabs
- If already processed, these changes must be considered for the next month
For many, this new change and its effect on salary processing might seem minor. But for organizations that have branches across different states, these computations are critical.
With clients spread all across India, greytHR is always in sync with the ever evolving statutory updates. As for this case, the changes in the PT slabs have been implemented in the greytHR application. Employers in West Bengal can process the salaries of the employees for the month of August, 2016, using greytHR without any hassle. The salary for the month of August, 2016, processed using greytHR, will reflect the changes as per the newly modified PT slabs.
If the salary for August, 2016, is already processed as per the old PT slabs, then the employer can use greytHR to reprocess the salary. greytHR calculates the PT for the employees and shows the exact PT amount payable. The employer then has to pay this amount.
To get more information on the changes made to the PT slabs, please visit our Statutory Compliance/ Labour Laws information site herehere.