Professional Tax deduction due to mid month transfer

[Former Member]

Dear All,

If employee works in two different state under same employer and both state charging Ptax then according which state employee should pay Ptax.

Regards,

Jayesh

[Former Member · Accepted solution]

Hi Jayesh,

The there will be a spilt in PTAX and for each split, there will be a particular slab code and based on that slab code the Ptax will be deducted.

For details check Function INPTX (processing).

Hope this will help you.

Thanks & Regards

Saroj Hial

[Former Member · Accepted solution]

Hi Saroj,

does it means that employee will have to pay Patx in both states?

[Former Member · Accepted solution]

Hi Jayesh,

Yes the employee will be paying PTAX for both the region as per their respective slab code.

Thanks & Regards

Saroj Hial

[Former Member · Accepted solution]

Hi Saroj,

The same thing is happening in system.

But whether it is correct? as employee is claiming that, double Ptax gets deducted.

Employee posting to different state is for the employer requirement, so why employee should pay double ptax (employee said).

[Former Member · Accepted solution]

Hi Jayesh,

Please tell me how much the PTAX is getting deducted for that particular month.

Thanks & Regards

Saroj Hial

[Former Member · Accepted solution]

Hi Jayesh,

This is not like that. If the PTax amount is 200, then it will split to 2 amounts.

For example, Lets consider Andhra Pradesh & Karnataka state. Their PT slabs are as below

Karnataka & Andhra Pradesh

upto Rs.9,999/- Nil

Rs.10,000/- to Rs.14,999/- Rs.150/-

Rs.15,000/- and above Rs.200/-

If employee transfer from Karnataka to Andhra Pradesh on mid of month(say 15th), then the PTax splits into 2 records.(say split 1 - 100 & split 2 - 100, if the PTax amount is 200). So the employee will pay for only one month.

Hope you got the clarity.

Regards,

Narayana

[Former Member · Accepted solution]

Hi Jayesh,

Based on the your scenario how the system calculates is as follows

Example:

An employee is hired in the month of April with his gross salary as 27050, ans now at present the employee is in karnataka, so now if we process his salary, the PTAX will get deducted as per Karnataka Slab code say 200Rs.

Now the same employee is transferred to Another location say Bhubenswar in the middle of May say 15.05.2013.

Now if we process the payroll, there will be a split.

Now if you go to function INPTX, you will find two PTAX Basis wage type (/118)

a) one with Karnataka

b) other with Bhubenshwar.

now before the PTAX gets calculated the PTAX basis amount will be projected.

So now say because of the split we have got two PTAX basis wage type

karnataka- 12216

Bhubenshwar - 14833.87

now if we project it,based on the projection the PTAX basis amount will be

Karnataka - 12616

Bhubenshwar - 14833.87 * 11 = 163172.57

Now the system will go to Table V_T7INP4 and check what is the deduction amount for the above PTAX Basis amount.

So in this case for the first split it will process 150 and for second split it will process 125.

so finally in the may month a total of 275Rs will be deducted from the employee as a PTAX.

Hope this will help you.

Thanks & Regards

Saroj Hial

[Former Member · Accepted solution]

200 as per Maharashtra & 200 as per WB slabs

[Former Member · Accepted solution]

Hi Jayesh,

Based on the your scenario how the system calculates is as follows

Example:

An employee is hired in the month of April with his gross salary as 27050, ans now at present the employee is in karnataka, so now if we process his salary, the PTAX will get deducted as per Karnataka Slab code say 200Rs.

Now the same employee is transferred to Another location say Bhubenswar in the middle of May say 15.05.2013.

Now if we process the payroll, there will be a split.

Now if you go to function INPTX, you will find two PTAX Basis wage type (/118)

a) one with Karnataka

b) other with Bhubenshwar.

now before the PTAX gets calculated the PTAX basis amount will be projected.

So now say because of the split we have got two PTAX basis wage type

karnataka- 12216

Bhubenshwar - 14833.87

now if we project it,based on the projection the PTAX basis amount will be

Karnataka - 12616

Bhubenshwar - 14833.87 * 11 = 163172.57

Now the system will go to Table V_T7INP4 and check what is the deduction amount for the above PTAX Basis amount.

So in this case for the first split it will process 150 and for second split it will process 125.

so finally in the may month a total of 275Rs will be deducted from the employee as a PTAX.

Hope this will help you.

Thanks & Regards

Saroj Hial

[Former Member · Accepted solution]

Dear All,

Thanks for your replies.

What your are trying to explain, that is happening in system.

But I want to know is it correct?

Is there any legal compliance stating that, annual professional tax deduction should be 25000?

Regards,

Jayesh

[former_member182306 · Accepted solution]

Yes, It is correct If that is the case , SAP would have come up with an alternative for Mid month Transfer for Professional Tax.

If employee works for two different states and both states are having Professional Tax Deduction  It will split it in two records An employee should pay for both states as per slabs and employee will pay for that month. A good example given already by Saroj Hial.

SAP is correct in this case.

Your doubt is depositing professional tax to two different states?? if in case if there is a transfer. It should be deposited two states as there is split in two records for two different states for example 100 for AP and 100 for MH. so company should pay 100 for AP and 100 for MH.

[Former Member · Accepted solution]

Thanks Rajesh,

Is there any maximum limit for ptax amount as 2500?

[former_member182306 · Accepted solution]

Could you please more clear on limit for Rs2500

[Former Member · Accepted solution]

Jayesh, max amt of pt for a particular FY is vary from state to state, you can check the PT config tables for  limit amt of PT which is Fixed deduction as per earnings.

[Former Member · Accepted solution]

Thanks for your replies