Hi Siva,
Professional tax cannot be prorated as it is not deducted on basis of attendance.
The Chennai professional tax is purely dependent on Gross Salary. For example an employee joined in the mid of the year for example an employee joined in the month of Feb and left in the month of august His/her gross salary is 10,000
According to rule it will divide 10000 by 6 months His professional will get deducted according to slabs
Many organizations deduct PT on a monthly basis by way of equal installments across a half –year period. For example, if an employee earns more Rs 15,000 each month (more than Rs 75,000 in a half-year), a sum of Rs 1095 should be deducted towards PT (please see the PT rate table above). Organizations following the equated monthly PT deduction method deduct Rs 182 (Rs 1095/6) each month towards PT in the monthly payroll. At the end of 6 months the organization will have deducted Rs 1095** for PT remittance. All is well.
**Rs 182 x 6 is actually Rs 1092 and not Rs 1095. This rounding-off problem can be easily solved by simply adding Rs 3 to the PT deduction amount during payroll in any of the months during the half-year period.
What happens if the employee does not work for the entire half-year period but leaves the organization at the end of say, 3 months? For example, let us assume that the employee works from 01-Apr-2012 to 30-Jun-2012 during the half-year period.
The company will have deducted Rs 546 (Rs 182 x 3) for the 3 months as per the equated monthly PT deduction logic. For the 3 months, the employee earned Rs 45,000 (this is the half-yearly salary since the employee leaves the organization), and for Rs 45,000 the organization should have deducted only Rs 235 as PT (please see the PT rate table above). In addition, Rs 546, the deducted PT amount, does not fall in any PT slab as specified by the Chennai Corporation. Ideally, the organization should refund Rs 311 (PT deducted in excess) to the employee. In practice, most organizations just remit whatever PT is deducted from employee salary. We have come across instances where PT authorities have questioned the basis of PT deduction when PT amounts do not fall under any PT slab.
There can also be instances when the equated PT deduction logic can lead to under-deduction of PT.
Let us assume that an employee earns Rs 7,000 per month (Rs 42,000 in a half-year period). The PT deduction for a half-year period should be Rs 235 (as per the PT slabs). As per the equated PT deduction logic, the organization will deduct Rs 39 per month (Rs 235/6). If the employee leaves the organization at the end of 5 months, the organization will have deducted Rs 195 as PT. However for an employee salary of Rs 35,000 (Rs 7,000 x 5 months), the organization should have deducted Rs 235. This is a case of under-deduction of PT.
The flaws of the equated PT deduction logic will come to the fore for any employee who does not work the entire six months in a half-year period.
If you are in favour of the equated PT deduction method and argue that you can always adjust the excess or short PT in the final settlement processing if an employee quits before the end of the half-year period, we will simply say that this will not be possible in case an employee absconds or does not have adequate settlement salary to recover the short PT in full.
In other words, the equated PT deduction logic is flawed and is better not followed. Of course, if an organization does not deduct PT each month but deducts PT only once every half year, this problem will not occur.