Advance Tax

About advance tax
As the name suggest, advance tax means payment of taxes in advance. In other words, ‘pay as you earn’.

Advance tax is payable during a financial year where the amount of tax payable is INR 10,000 or more (section 208).

Provisions of the advance tax shall not apply to an individual resident in India if the following conditions are satisfied (section 207) –

1. The resident individual does not have any income chargeable under the head ‘Profit and gain of business or profession’; and

2. The resident individual is senior citizen (age of 60 years or more) at any time during the previous year.

It must be noted that advance tax is applicable to all the taxpayer, however, if the resident individual fulfills the above two mentioned conditions, then, he is not required to make an advance tax payment.

Due Dates of payment of Advance Tax
Provisions of section 211 of the Income Tax Act, 1961 specifies the % of advance tax and due dates thereon.

Following table reflects the advance tax due dates for individual and corporate taxpayers [applicable for taxpayers other than assessee covered u/s 44AD(1) or u/s 44ADA(1)] –

ADVANCE TAX DUE DATES            PERCENTAGE OF ADVANCE TAX PAYABLE
On or before 15th June                     15% of advance tax
On or before 15th September           45% of advance tax
On or before 15th December            75% of advance tax
On or before 15th March                   100% of advance tax

For taxpayers who have opted for Presumptive Taxation Scheme

Due Date                          Advance Tax Payable
by 31st March                  100% of advance tax

Mode of payment of advance tax
As per Rule 125 of the Income-tax Rules, 1962 a a company shall pay taxes through the electronic payment mode using the internet banking facility of the authorised banks.

Taxpayers other than a company, who are required to get their accounts audited u/s 44AB, shall pay taxes through the electronic payment mode using the internet banking facility of the authorised banks.

Any other taxpayer can pay tax either by electronic mode or by physical mode i.e. by depositing the challan at the receiving bank.

Capital Gains or Casual Income After 15th March: 
IF any Assessee has Capital Gains or Casual Income After 15th March, then Assessee should pay tax on Such Income up to 31st March of that Previous Year to Avoid Interest us/ 234C and 234B.

Late fee for not deposting Advcane tax

If you do not pay Advance Tax on due dates according to the schedule given above, then you have to pay Late Fee/penalty. It is charged under two rules.

In case of delay in instalment under Section 234C

If you do not pay advance tax on due date mentioned in the table given above, then the late fees in the next instalment by 1 percent for the previous part will be added.

If full tax has not been deposited for the period under Section 234B

If you do not pay up to 90% of your Advance Tax till the end of the financial year, then the Late fees of 1 percent on the outstanding amount will also be charged.

Self-Assessment Tax

In case of advance tax is not paid or there is balance in the tax liablity then you can make payment by paying Self assessment tax.