Advance tax is the income tax payable by individuals who earn from other sources along with their salary. Rent, capital gains from shares, fixed deposits, lottery, etc. are a few examples of income sources covered under advance taxation. 


There is a simple and easy process to make advance tax payments online. You can do so using tax payment challans at authorised banks. You can also make advance tax payments through the official website of the Income Tax Department or the National Securities Depository Limited (NSDL).

Who Should Pay Advance Tax

Now that you know the meaning of advance tax, understand the below points to know who is liable to pay advance:

  • If tax liability is ₹10,000 or more

  • A salaried or self-employed individual

  • If the income is received via capital gains on shares

  • If one has earned interest on FD

  • If one has won a lottery

  • If one earns rental income or income earned through house property

  • Senior citizens with business income must pay advance tax

  • Taxpayers under Section 44AD must pay advance tax by 15 March or 31 March

  • Professionals under section 44ADA pay advance tax by 15 March or 31 March

Due Dates for Advance Tax Payment

Here are the advance tax due dates you must adhere to:

For individuals and corporates:

Due Date

Percentage of the advance of tax

By 15th June

15% 

By 15th September

45% (-) advance tax paid earlier

By 15th December

75% (-) advance tax paid earlier

By 15th March

100% (-) advance tax paid earlier

If you have opted for the presumptive taxation scheme u/s 44AD and 44ADA, you must pay 100% of the advance tax by the 15th of March.

How to Pay Advance Tax Online

Follow the below steps to make the advance tax payment online:

  1. Go to the e-filing portal of the Income Tax Department 

  2. Locate the 'Quick Links' section on the homepage and select 'e-Pay Tax' 

  3. Provide your PAN and your mobile number, and then click on ‘Continue’

  4. Input the 6-digit OTP received on your mobile and proceed

  5. Select the checkbox ‘Income Tax’ and click ‘Proceed’

  6. Provide the ‘Assessment Year’ 

  7. Select ‘Advance Tax (100)’ under ‘Type of Payment’ 

  8. Click on 'Continue'

  9. Enter the tax details 

  10. Select the payment method and bank, then click on 'Continue'

  11. Review the challan details and click on ‘Pay Now’

  12. Save the acknowledgement for online advance tax payment

 

Note down the BSR code and challan number, which you'll need for your tax return.

 

Advance Tax Challan 280

Challan 280 enables you to pay income tax online via the Income Tax Department’s official website. You have to select this challan and fill out the form to make an online advance tax payment. In case you want to pay it offline, you can download challan 280, fill it out, and then submit it at the bank.

 

Here are the documents that you need to submit for advance tax payment:

  • Aadhaar Card

  • PAN Card

  • Form 16, 16A, 16B, 16C

  • Form 26AS

  • Interest certificates issued by bank or post office

  • Tax saving investment proof

  • Salary slips and bank statement

  • Home loan statement

  • Capital gain statement

How to Calculate Advance Tax Payment

Learning how to calculate advance tax is important and quite easy. Here’s how: 

  1. Calculate the total income earned from all sources for the financial year

  2. Add your salary to the above sum to get your gross taxable income

  3. Consider deductions, if any

  4. Calculate the tax payable amount as per the applicable income tax slab 

  5. Subtract the TDS already deducted, if any

 

To better understand the calculation of advance tax, consider the following example where your tax liability is ₹50,000. Here, your instalments for advance tax payments will be as follows: 

Payment Due Date

Amount to be Paid as Advance Tax

On or before June 15

₹7,500 (15% of ₹50,000)

On or before September 15

₹15,000 (45% of ₹50,000 - ₹7,500)

On or before December 15

₹15,000 (75% of ₹50,000 - ₹22,500)

On or before March 15

₹12,500 (100% of ₹50,000 - ₹37,500)

You can also use an advance tax calculator to know your advance tax liability easily. All you have to do is enter your income earned, applicable deductions, and other details.

Advance Tax Late Payment and Interest

Here is an overview of the advance tax penalty rate under different sections of the Income Tax Act. 

  • Under Section 234B

By 31st March, you need to pay a minimum of 90% of the total taxes as TDS/TCS or advance tax. Non-payment will lead to a 1% interest on the unpaid amount.

  • Under Section 234C

Particulars

Interest Rate

Interest Period

Amount

If the tax paid by 15th June is less than 15%

1% per month

3 months

15% of Amount (-) tax paid before June 15

If the tax paid by 15th September is less than 45% 

1% per month

3 months

45% of Amount (-) tax paid before September 15

If the tax paid by 15th December is less than 75% 

1% per month

3 months

75% of Amount (-) tax paid before December 15

If the tax paid by 15th March is less than 100%

1% per month

1 month

100% of Amount (-) tax paid before March 15

FAQs on Advance Tax

Can I make the payment of advance tax online?

Yes, you can pay advance tax online via the official website of the Income Tax Department.

Should an NRI make an advance tax payment?

An NRI whose income in India exceeds ₹10,000 must pay advance tax.

What should I do if I miss the deadline for the fourth instalment?

If you don’t pay the required tax by the fourth instalment, i.e. March 15, you should pay it at the earliest, preferably by March 31.

What is the mode of payment of advance tax online?

You can pay for the advance tax online via net banking.

What is the advance tax instalment distribution?

You need to pay 15% of the advance tax on or before June 15, i.e., the first instalment. By the second, third, and fourth instalments, you must pay 45%, 75%, and 100% of advance tax liability. The due dates for these are on or before the 15th of September, December, and March, respectively.

How can I get an advance tax refund?

If the Income Tax Department identifies that your paid tax is higher than the liability, then the government shall refund the excess amount. You can also claim a refund while filing ITR. The claim must be made within one year.

Know Your Tax Liability | Calculate Your Income Tax Now! Calculate Tax
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