Profession Tax is a state-level tax that applies to salaried employees and professionals, including chartered accountants, lawyers and doctors. The following states impose this tax:
West Bengal, Karnataka, Andhra Pradesh, Maharashtra, Tamil Nadu, Gujarat, Assam, Chhattisgarh, Kerala, Meghalaya, Orissa, Tripura and Madhya Pradesh.
Registration is mandatory within 30 days of employing staff in a business or, in the case of professionals, 30 days from the start of the practice. This tax needs to be deducted from the salary or wages paid; the amount varies by state and amount, but is capped at Rs. 2500 per year.