Full Exemption from PT Liability

• Most state governments in India offer complete exemption from professional tax for employees with disabilities.
  
• This exemption is granted regardless of the salary or income level of the disabled employee.
  
• The benefit is applicable to both salaried employees and self-employed individuals with certified disabilities.
  
• The exemption applies only when the disability is legally recognized and documented as per the state rules.
  

Applicable Disabilities Recognized for Exemption

• Eligible disabilities generally include:
  
  • Blindness or low vision
    
  • Hearing impairment
    
  • Locomotor disability
    
  • Mental retardation or mental illness
    
  • Autism, cerebral palsy, and multiple disabilities
    
• The exact list may vary slightly by state, and is based on the Persons with Disabilities Act or Rights of Persons with Disabilities Act.
  
• Proof of disability must be issued by a government-authorized medical board or civil surgeon.
  

Document Submission Requirements

• To claim the exemption, the following documents are generally required:
  
  • Disability certificate issued by a competent medical authority.
    
  • Employee declaration requesting exemption from PT deduction.
    
  • Identification proof and employment details for verification.
    
• Employers must maintain these documents in their records and produce them when required by tax authorities.
  

Employer’s Responsibility in Payroll

• Employers must ensure that disabled employees are excluded from PT deduction during salary processing.
  
• Such employees should not be included in the PT return deduction schedule.
  
• Employers should also track changes in employee status and update exemption eligibility annually if mandated by the state.
  
• The payroll software should be configured to handle these exemptions automatically once approved.
  

State-Specific Procedures and Acknowledgment

• Some states may require pre-approval or submission of exemption claims through the PT portal or local office.
  
• The exemption may be noted in the employee master data and reflected in PT audit records.
  
• The compliance team must verify whether the state provides automatic exemption or requires separate application.
  
• Proper classification ensures no inadvertent deductions and avoids future refund complications.