What is the professional tax slab in Gujarat?
Professional tax in Gujarat comes under the Gujarat State Tax on Professions, Trades, Callings and Employment Act, 1976. Within Gandhinagar city limits, the Gandhinagar Municipal Corporation (GMC) collects it on behalf of the state. Rates for salaried employees, in force since 1 April 2022:
| Monthly salary | Professional tax per month |
|---|---|
| Below ₹12,000 | Nil |
| ₹12,000 and above | ₹200 |
The employer deducts it from salary each month and pays it to the GMC (or the state, outside municipal limits). Separately, companies, factory owners and partnership firms in Gandhinagar & GIFT City pay their own professional tax of ₹2,000 a year; check the due date with the GMC.
How much is the Gujarat Labour Welfare Fund?
The Gujarat Labour Welfare Fund is collected every six months. Since December 2016, each employee pays ₹6 and the employer pays ₹12 per collection, so ₹18 in total per employee.
What are the PF contribution rates?
Provident Fund applies to establishments with 20 or more employees.
- Employee
- 12% of basic wage plus dearness allowance (DA)
- Employer
- 12% of basic wage plus DA, split into 8.33% to the pension scheme (EPS) and 3.67% to the provident fund (EPF)
- Extra employer charges
- 0.5% admin charge and 0.5% for EDLI insurance
- Wage ceiling
- ₹15,000 a month for mandatory coverage
What are the ESI contribution rates?
ESI covers employees earning up to ₹21,000 a month (₹25,000 for persons with disabilities).
- Employee
- 0.75% of wages
- Employer
- 3.25% of wages
What's different for startups and finance firms in Gandhinagar and GIFT City
Startups and finance firms here tend to pay salaries above the ESI and PF wage ceilings, and many are small enough to sit near the PF threshold.
- ESI
- Often doesn't apply, since most salaries are above ₹21,000 a month. It still covers support staff earning ₹21,000 or less once you have 10 or more employees.
- PF ceiling
- Contributions can be restricted to the ₹15,000 wage ceiling (₹1,800 a month each side); paying on the full basic is optional.
- New joiners
- An employee joining on more than ₹15,000 basic who has never been a PF member can be treated as an excluded employee.
- GIFT City
- GIFT City units may fall outside Gandhinagar municipal limits; confirm with your CA which authority collects professional tax for your unit.
Worked example: an employee in Gandhinagar & GIFT City earning ₹30,000 a month
Assume gross wages of ₹30,000, basic wage of ₹15,000, and that the employer is covered by PF and ESI.
| Deduction | Employee pays | Employer pays |
|---|---|---|
| Professional tax | ₹200 | — |
| PF (12% of ₹15,000) | ₹1,800 | ₹1,800 |
| ESI (on ₹30,000) | — | — |
| Gujarat LWF (only in the collection months) | ₹6 | ₹12 |
PF admin and EDLI charges (0.5% each) are extra for the employer.
How Starcore helps
Starcore runs payroll on your own attendance and leave data and flags exceptions before payday, so deductions are worked out on the right salary.
FAQ
Is professional tax deducted for salaries below ₹12,000 in Gujarat?
No. It is nil below ₹12,000 a month.
How often is Gujarat LWF paid?
Twice a year.
Does PF apply to a company with 12 employees?
The PF Act applies to establishments with 20 or more employees; smaller ones may still register voluntarily.
Do I have to pay PF on the full basic for senior hires?
No. You can restrict contributions to the ₹15,000 wage ceiling, unless you and the employee opt for higher contributions.
Disclaimer — rates change. This guide is for information only and is not legal or tax advice; confirm with your CA or the official portals before filing.
Last updated 8 October 2026 · Verified against GMC, Gujarat Labour Welfare Board, ESIC and EPFO.Sources
Verified 7 October 2026 against official pages: PT slab (Gujarat Commercial Tax), LWF amounts (Gujarat Labour Welfare Board), ESI rates and wage ceiling (ESIC), PF rates and wage ceiling (EPFO).