Advance Tax – Guide

Advance Tax


Advance Tax is a way of collection of tax by the government. If total income of an asessee exceeds Rs 10,000 in a financial year, tax is payable in installments of your yearly tax payable. It should be paid in the year in which the income is earned. In other words, it is ‘Pay as You Earn’ approach. Income can be earned from many sources like salary, interest, rent received etc.

Who pays Advance tax?

Business and self employed professions have to pay advance taxes. If you are working under someone and getting salary for your work, Tax is deducted in the form of ‘TDS’ from salaries, such assesee is not liable to pay advance tax. However, if income from other sources exceeds Rs 10,000. You will need to apply for advance tax for such income.

Exemptions from payment of advance tax

A senior resident (60 years of age or above) who does not have any income chargeable under the head PGBP.

An Assesse who has opted a scheme under section 44AD.

Due dates for payment of tax

An assee is liable to pay the installments of tax on or before the following dates:
For Assessment year 2016-17, due dates of advance payment of tax has changed and is same for both corporate assesses and non corporate assesses
Due dates of Income tax return Filling

  • What if you fail to pay taxes even after the due dates?

If an assesse fails to pay tax on or before the due date, he is liable to pay interest along the installment. If he fails to file the return on tax, he becomes liable to pay penalty. PENALTY OF LATE FILING OF INCOME TAX RETURN. Return can be filed at any time before 1 year from the end of relevant assessment year, so if the income is earned in the previous year 2015-2016. The returns should be filed before 31st march 2018. If an assesse fails to file the return on or before the due date. He/she would be liable to pay penalty of Rs 5000 under section 271F.
INTEREST ON LATE PAYMENT OF ADVANCE TAX Assesse becomes liable to pay interest if he fails to pay tax installment on/before due date. Such tax is attracted under sections 234A, 234B, and 234C as follows:

  • Interest under section 234A: Default in Furnishing the return of income:

Interest at 1% for each month the assessee delays the payment of tax as per the schedule mentioned above. The calculation begins from the due date to the date of furninshing of return.

  • Interest under section 234B: Default in late payment of tax:

If the tax already paid by the assesse in the financial year is less than 90% after 31st march, he is liable to pay interest at 1% chargeable from 1st April of the assessment year to the date of completion of total income tax under section 143(1).


  • Interest under section 234C: Deferment of advance tax.

Such interest is applied when tax is paid in underestimated installment or not paid at all. Interest is calculated on the amount not paid @ 1% for 3 months.If such deferment is after 15th march, such interest will be charged at 1% per month.
Now you can file ITR online with the help of experts at TaxRaahi.

Due date Corporate Assessee (company) Non Corporate Assessee
Upto 15th june 15% of tax Not applicable
Upto 15th septmber 45% of tax 30% of tax
Upto 15th December 75% of the tax 60% of the tax
Upto 15th march 100% of the tax 100% of the tax
Due Date Tax payable
Upto 15th june 15% of the tax
Upto 15th September 45% of the tax
Upto 15th December 75% of the tax
Upto 15th march 100% of the tax
Dates Categories
31st July For individuals
30th September For Companies
30th September For individuals who need to get accounts audited
30th september For firms that require accounts to be audited

For any help on ITR Filing feel free to consult the tax experts at Taxraahi. You can file ITR yourself via our ITR software or get CA’s help on filing income tax return. You can also use the option of Business ReturnBulk Return or Revised Return Filing.


By | 2018-08-08T08:53:37+00:00 June 29th, 2016|Categories: Income Tax Guide|Tags: , |0 Comments

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