Professional tax by state and statutory challans

Deduct professional tax by each employee's state, download the PF, ESI, PT and TDS files to upload, and record the challans you pay.

Axis works out professional tax for each employee by the state they work in, prepares the PF, ESI, professional tax and TDS files from your finalized payslips, and keeps track of which challans you have paid and which are due.

Before you start: you need Full control of People (Team → Roles), which covers salaries and payroll, and payroll must be set up with at least one finalized run.

Set up professional tax

  1. Open People → Rules & settings → Pay and turn on Professional tax.
  2. In Company default state, pick the state most of your people work in. Pick None — use custom slabs only if you want to enter your own slabs.
  3. In the state table, type your Registration no. for every state you pay professional tax in. It is printed at the top of that state's file.
  4. Check the rules for each state you use. Every state ships marked Check · as of a date — click Edit, compare the slabs with your state's current notification, correct anything that differs and click Use these rules. An edited state shows Edited; Reset to default brings back the shipped rules.
  5. Click Save payroll rules.

Each person pays in the state chosen on their employee record (Professional tax state). If that is blank, Axis uses the state on their Work location, and if that is blank too, the company default state.

What the state rules cover

  • Monthly or half-yearly. Most states deduct every month. Tamil Nadu, Kerala and Puducherry deduct twice a year — the slabs are then on the half-year's income.
  • A different amount in one month. For example, Maharashtra and Karnataka deduct ₹300 in February instead of ₹200. Set it with Special month and the In the special month amount on each slab.
  • Women's slabs. Where a state has separate slabs for women (Maharashtra), add them under Women's slabs. Axis uses them for employees whose gender is female.
  • Due day. The day of the following month the payment is due, used to flag overdue months. Leave it at 0 if you don't want it tracked.

Download the files to upload

  1. Open People → Payroll → Statutory.
  2. Under Monthly returns, pick the Month.
  3. Fix anything listed under Fix before filing — for example a missing UAN, ESI IP number or registration number. People with a missing number are left out of that file until you fix it.
  4. Download what you need:
    • ECR file (EPFO) — the text file for the EPFO Unified Portal.
    • ESI contribution sheet — the spreadsheet for the ESIC portal's monthly upload.
    • Professional tax by state — one file per state, or Professional tax (all states).
  5. For TDS, use Download 24Q data under TDS return (24Q) each quarter, and open it in the return preparation utility to generate the file you submit.

Axis prepares these files. Uploading them and filing the returns on the EPFO, ESIC, state and income-tax portals is done by you or your CA.

Record a challan after you pay

  1. Open People → Payroll → Statutory → Challans — paid vs due and pick the Financial year.
  2. Find the month and return, and click Record challan. The type, month and amount still to pay are filled in.
  3. Enter Paid on, the reference from your receipt — the TRRN for PF, the Challan number for ESI, the Receipt / challan number for professional tax, or the Challan serial no. and 7-digit BSR code for TDS — and any Interest or Late fee / penalty.
  4. To post the payment to your books, pick the bank account in Paid from. Axis debits your statutory dues payable account and credits that bank.
  5. Click Record.

The month's status changes to Paid, Part paid, Due or Overdue (past its due date and not fully paid). Recorded TDS challans fill the challan sheet of your 24Q data, so you don't have to type the BSR code and serial number again.

Good to know

  • The shipped state rules are a starting point, not legal advice. Check each state you pay in, and edit it when a state changes its rates.
  • For half-yearly states, Axis works out the half-year's income from the gross of the month it deducts in (gross × 6), not from what was actually paid across the six months.
  • Professional tax exemptions (for example for people with disabilities or senior citizens) aren't applied automatically. Adjust that employee's payslip before you finalize the run.
  • Interest and late fees are recorded on the challan but aren't posted to your books — record them in Accounting.
  • Posting a challan needs a Statutory dues payable account mapped under Rules & settings → Pay → Ledger. Without one, challans are only recorded.
  • Removing a challan that was posted leaves its journal entry in place. Reverse it in Accounting.
  • The professional tax file is a CSV of employees, gross wages and deductions. Some state portals ask you to type the totals in instead of uploading a file.