Professional Tax Requirements - Andhra Pradesh

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Professional tax registration is mandatory for startups and businesses in Andhra Pradesh as soon as you employ staff or begin earning income. While company directors can manage it, most opt to delegate this to a Chartered Accountant. Professional tax applies to all employees, including part-time staff, interns receiving stipends, contract workers, and freelancers, with certain exemptions available for specific groups.

V Manikanta P

V Manikanta P (Querist)
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07 December 2025 Hi,
If we regiater a startup in andhra pradesh is professional tax registration manditory? also At what point we need to register for professional tax. Is it managed by CA or company director should manage it. Also Professonal tax is paid only for Full time employees or interns/parttime/contractors/freelancers too?

Anyone please help me
Thanks

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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07 December 2025 Yes, professional tax registration is mandatory in Andhra Pradesh for startups and businesses. You must register once you employ staff or start earning income through trade/profession. The company director can manage it, but most businesses delegate compliance to a Chartered Accountant (CA). Professional tax applies to all salaried employees, and in Andhra Pradesh it also covers interns, part-time workers, contractors, and freelancers, unless they fall under specific exemptions. Under the Andhra Pradesh Tax on Professions, Trades, Callings and Employments Act, 1987, every employer and professional earning income in the state must register for professional tax, at the time of hiring employees or starting operations.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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07 December 2025 Professional tax in Andhra Pradesh applies broadly:
• Full-time employees – Yes, deducted from salary.
• Part-time employees – Yes, based on income slab.
• Interns – If they receive a stipend, it is treated as income and taxable.
• Contract workers – Yes, unless exempted by specific rules.
• Freelancers/self-employed – Must register and pay directly.
• Exemptions – Certain categories like senior citizens, disabled persons, or low-income earners may be exempt depending on slab rates.

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