Professional Tax in Odisha 2025: Latest Slab Rates, Payment Process & Compliance

1. Professional Tax
2. Professional Tax in Odisha 2025: Latest Slab Rates, Payment Process & Compliance

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In Odisha, professional tax is a state-imposed tax managed under the Orissa State Tax on Professions, Trades, Callings, and Employments Act, 2000. It applies to all salaried individuals, self-employed persons, professionals, and businesses operating within the state. The Orissa professional tax is levied based on income slabs to ensure a fair contribution from every earning individual or entity.

The revenue collected through professional tax is utilized in funding state-administered services, welfare programs, and infrastructure development, strengthening the region’s development.

While there have been no recent changes to the slab rates, the Odisha Professional Tax Slab Notification issued by the Commercial Tax Department regularly updates employers, HR professionals, and taxpayers on the eligibility, slab rates, payment procedures, and registration requirements to avoid penalties and ensure smooth filing.

What is Professional Tax in Odisha?

Salaried employees in the government or private sector, self-employed individuals, or professionals such as doctors, engineers, lawyers, chartered accountants, or company secretaries working in Odisha are required to pay professional tax according to the professional tax slab in Odisha.

Professional Tax Applicability in Odisha

Under the Orissa State Tax on Professions, Trades, Callings and Employments Act, 2000, these individuals/entities must register and pay:

• Salaried Individuals (Government and Private): Employers deduct the monthly professional tax from salaries and deposit it with the state treasury.
• Self-Employed Professionals: Doctors, lawyers, CAs, consultants, and similar professionals must enroll and pay tax annually as per the slabs.
• Businesses, Companies, LLPs, HUFs, and Societies: These must register as a ‘Professional Tax Deductor’ under the Act. Employers must deduct professional tax from their employees’ salaries based on the applicable Odisha professional tax slab rates and deposit the amount into the Head of Account of the Government of Odisha through the state treasury.
• GST-Registered Entities: Entities registered under Odisha’s GST or VAT Act must enroll and pay a fixed ₹2,500 per annum, regardless of income.

Who Must Register and Pay Professional Tax?

At the end of the financial year, employers must file an annual return using Form V. This form must be submitted online via the Odisha Commercial Tax Department portal within the due date specified by the department to avoid penalties.

Additionally, the professional tax paid by salaried individuals can be claimed as a deduction under the old regime of the Income Tax Act.

Professional Tax Slab Rates in Odisha 2025

Understanding the professional tax Odisha slab is essential for both employers and employees to ensure proper compliance. The professional tax in Odisha varies by income and profession, affecting how much individuals and professionals need to pay.

Here is a consolidated table that outlines the professional tax in Odisha for both salaried individuals and professionals based on their monthly and annual incomes:

Sample Calculation

If your salary is ₹30,000/month, that totals ₹3,60,000 annually, placing you in the highest slab.

You would pay:

• ₹200 per month for the first 11 months = ₹2,200
• ₹300 in February or one month as per rule = ₹2,500 total for the year

The professional tax amount in Odisha ranges between ₹1,500 and ₹2,500 per year, depending on the income slab. The maximum professional tax payable in Odisha is ₹2,500 annually.

To make tax calculations even easier, using the Professional Tax Calculator Tool for Odisha can be greatly helpful. Taxpayers can input their monthly or annual income and immediately see the applicable slab, monthly and yearly tax liability, total exemptions, and maximum payable tax.

Exemptions

The following categories are not liable to pay professional tax:

• If any individual has an annual income up to ₹1,60,000, they are exempt from professional tax.
• Military personnel, severely disabled individuals, and women not in employment may also qualify for exemption depending on state policy.

Odisha Professional Tax Online Payment Process

Paying professional tax in Odisha is easy and efficient. Here’s a step-by-step guide to help you with Odisha professional tax registration online:

Step 1: Visit the Official Portal

• Go to the Integrated Financial Management System (IFMS) Odisha website.
• On the homepage, navigate to the ‘e-Payment’ option under ‘Other e-Services’.

Step 2: Generate PTIN (for First-Time Registration)

• If you’re paying professional tax for the first time, you must register and generate a one-time PTIN (Professional Tax Identification Number).
• To do this, go to the Commercial Tax Department portal via the IFMS site. Click on PT Registration / Enrollment. Fill in details like Name, PAN/Aadhaar, Address, Business/Professional Details, etc. Submit the form and obtain your PTIN.
• Once the PTIN is generated, you can use it for all future professional tax payments.

Step 3: Choose Payment Mode

• Select ‘Commercial Tax’ under Online Challan Submission.
• Choose ‘Professional Tax’ as the payment type.
• Enter your PT Registration / Enrollment Number (PTIN).
• If you’re a GST-registered entity, you may also use your GSTIN to make the payment.

Step 4: Enter Depositor and Payment Details

• Provide Depositor Details like name, address, and contact information.
• Fill in the Identification of Depositor (PTIN / GSTIN).
• Verify all details carefully to avoid payment errors.

Step 5: Make the Payment

• Choose your preferred payment method (Net Banking, UPI, Debit/Credit Card).
• Click ‘Proceed Payment’ to complete the transaction.

Step 6: Save the Challan and GRN

• After successful payment, the system generates a GRN (Government Reference Number).
• Download and save the payment challan. This will be required while filing Form V and for future audits.

Penalty for Not Paying Professional Tax in Odisha

Not adhering to the professional tax in Odisha payment deadlines can lead to significant penalties. Individuals enrolling before May 31 must pay the tax by June 30. For those registering after May 31, the tax is due within a month of registration.

Failure to pay or deduct this tax from employee wages incurs a simple % interest rate of 2% per month. This is calculated on the overdue amount or any remaining unpaid tax. Additionally, lacking a valid reason for non-payment might trigger a penalty ranging from 25% to 50% of the owed tax, plus interest charges.

It’s of utmost importance for both employers and individual taxpayers to comply with professional tax regulations in Odisha. Non-compliance can lead to significant financial burdens due to penalties, interest, and legal repercussions. Employers, in particular, must diligently pay professional tax to avoid compounding penalties.

However, there are exemptions. Members of the Union’s armed forces serving in any region of Odisha are exempt from paying professional tax. Understanding these implications and exceptions is essential for all parties subject to professional tax.

Wrapping up

Understanding the Odisha professional tax slab rates, ensuring correct deductions, and making timely payments are essential for smooth tax management. Since the Odisha Commercial Tax Department issues periodic notifications to guide taxpayers, staying updated with the latest rules helps businesses and professionals remain compliant. Using automated payroll systems can make Odisha professional tax registration and return filing faster and easier.

By keeping up with the rules and using innovative tools, businesses and individuals can handle their tax responsibilities with ease and avoid last-minute hassles.

Frequently Asked Questions

How is Professional Tax Calculated in Odisha?

Professional tax in Odisha is calculated based on the monthly/annual income notified by the government. Individuals earning up to Rs 1,60,000 annually are exempted from paying professional tax.

Can I Pay My Professional Tax Online in Odisha?

Professional tax can be paid online through the Integrated Financial Management System, Odisha. This system provides a convenient and efficient way to handle tax payments.

How to Check if Professional Tax is Paid or Not in Odisha?

To verify payment status, visit the IFMS Odisha e-Payment Portal. Go to the ‘Track Challan Status’ or ‘Verify Payment’ option, enter your PTIN/Challan Reference Number, and the system will display your payment details, including status and receipt download options.

What are the Consequences of Not Paying Professional Tax on Time?

Late payment of professional tax can result in penalties, including fines and interest on the due amount, which can accumulate until the tax is fully paid.