Payment of tax liability by a person before the end of the financial year is called advance tax
Due date of installment | Amount payable |
On or before 15th September | Not less than 30% of the advance tax liability |
On or before 15th December | Not less than 60% of the advance tax liability |
On or before 15th March | 100% of the advance tax liability |
Due date of installment | Amount payable |
On or before 15th June | Not less than 15% of the advance tax liability |
On or before 15th September | Not less than 45% of the advance tax liability |
On or before 15th December | Not less than 75% of the advance tax liability |
On or before 15th March | 100% of the advance tax liability |
Advance tax has to be paid on the 15th of September, December and March— in instalments of 30%, 30% and 40%, respectively—for self employed and businessman. Companies need to pay it on the 15th of June, September, December and March.
How to file it?
Individuals may pay advance tax using tax payment challans at bank branches authorised by the Income Tax (I-T) Department. It can be deposited with the Reserve Bank of India, State Bank of India, ICICI Bank, HDFC Bank, Indian Overseas Bank, Indian Bank, Allahabad Bank, Syndicate Bank, Axis Bank, Punjab National Bank, Punjab & Sindh Bank and other authorised banks. There are 926 branches in India that can accept advance tax payments. Individuals may also pay it online through the I-T department or the National Securities Depository.
If you miss the deadline
If you fail to pay or the amount you’ve paid is less than the mandated 30% of the total liability by the first deadline (15 September), you will need to pay an interest. This is computed @ 1% simple interest per month on the defaulted amount for three months.
The same interest penalty would apply if you fail to pay the second deadline (15 December). Failing to pay the third and last deadline (15 March) would mean paying 1% simple interest on the defaulted amount for every month until the tax is fully paid.
What if advance tax paid is more than required?
If the amount paid as advance tax is higher than the total tax liability, the assessee will receive the excess amount as a refund. Interest @ 6% per annum will be paid by the Income Tax department to the assessee on the excess amount if the amount is more than 10% of tax liability.
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