Last Date for Payment of Advance of Income Tax i.e. 15th December, 2015

Friends,

            Today is last date for payment of Advance Income Tax for the Financial Year 2015-16 or Assessment Year 2016-17 as 2nd Installment for Non-Company cases for 3rd Installment for Company cases. 

           This payment is too much important or necessary for those who are earning their Income with their own sources or who are not availing loan facility from any Financial Institute.  In the other word they are doing their business with their own funds and do not pay Interest on Loan to any financial institutions / Banks etc. 

          In case the above installment is not paid in time, the assessee has to pay penalty of income tax in the shape of Interest under section 234C or 234B

Click on below picture to deposit Advance Tax etc.

Interest on Late payment of Advance Tax :

Interest u/s 234C or 234B is liable on late payment of Advance Income Tax :-

1. Interest u/s 234C -  Interest @ 1% per month is payable if the tax is not deposit in time. 

2. Interest under section 234B- Interest @ 1% is payable if 90% of the tax is not deposit before the end of the financial year i.e. for Default in Payment of Advance Tax 

How to deposit Advance Tax :-

              There is two mode of payments for deposit Advance Tax.  

1. Manual Challan. 

2. e-Payment or Online Payment through Challan No 280. Click Here for e-Payment 

              Online payment is best method to deposit Advance Tax and it is easy or hassle free.   No need to visit Bank again and again. 

Advance Tax :- Due Date of Advance Tax is 15th June for Corporate

Deposit of Advance Income Tax is necessary to avoid Interest penalty in future.  Each assessee should calculate their Income Tax for the current Financial Year  and should deposit Advance Income Tax in time as per applicability.  Percentage of Advance Tax due in particular date is given below :-

Advance tax is to be calculated on the basis of expected tax liability of the year. Advance tax is to be paid in instalments as given below:

​Status	By 15th June	By 15th Sept	15th Dec	15th March
Corporate	15%	45%	75%	100%
Non-Corporate	Nil	30%	60%	100%

Any tax paid till 31^st March is treated as advance tax.

The deposit of advance tax is made through challan ITNS 280 by ticking the relevant column, i.e., advance tax.

Income Tax :- Due Advance Tax on 15th March, 2015

Friends,   Payment of advance tax is due on 15-03-2015 for all assessees whose tax amount exceeds Rs. 10,000/- in the Financial Year 2014-15 or Assessment Year 2015-16.   There are two category of assessees named Corporate or Non-Corporate.

 

                The amount of Advance Tax can be deposited through Challan No. 280 by selecting (100) as the type of payment.  In case Advance Tax is not paid in time, Assessee has to pay interest on account of  non payment or late payment of Advance Tax under section 234B or 234C. 

To calculate Advance Tax , Advance Tax Calculator is available here. (Read & Download)

Detail of Section 234B

⁵⁸[Interest for defaults in payment of advance tax.

234B. (1) Subject to the other provisions of this section, where, in any financial year, an assessee who is liable to pay advance tax under section 208 has failed to pay such tax or, where the advance tax paid by such assessee under the provisions ofsection 210 is less than ninety per cent of the assessed tax, the assessee shall⁵⁹ be liable to pay simple interest at the rate of ⁶⁰[one] per cent for every month or part of a month comprised in the period from the 1st day of April next following such financial year ⁶¹[to the date of determination of total income under sub-section (1) of section 143 ⁶²[and where a regular assessment is made, to the date of such regular assessment, on an amount]] equal to the assessed tax or, as the case may be, on the amount by which the advance tax paid as aforesaid falls short of the assessed tax.

⁶³[Explanation 1.—In this section, "assessed tax" ⁶⁴ means the tax on the total income determined under sub-section (1) of section 143 and where a regular assessment is made, the tax on the total income determined under such regular assessment as reduced by the amount of,—

(i) any tax deducted or collected at source in accordance with the provisions of Chapter XVII on any income which is subject to such deduction or collection and which is taken into account in computing such total income;

(ii) any relief of tax allowed under section 90 on account of tax paid in a country outside India;

(iii) any relief of tax allowed under section 90A on account of tax paid in a specified territory outside India referred to in that section;

(iv) any deduction, from the Indian income-tax payable, allowed under section 91, on account of tax paid in a country outside India; and

(v) any tax credit allowed to be set off in accordance with the provisions of section 115JAA ⁶⁵[or section 115JD].]

Explanation 2.—Where, in relation to an assessment year, an assessment is made for the first time under section 147 ⁶⁶[or section 153A], the assessment so made shall be regarded as a regular assessment for the purposes of this section.

⁶⁷[Explanation 3.—In Explanation 1 and in sub-section (3) "tax on the total income determined under sub-section (1) of section 143" shall not include the additional income-tax, if any, payable under section 143.]

(2) Where, before the date of ⁶⁸[determination of total income under sub-section (1) of section 143 or] completion of a regular assessment, tax is paid by the assessee under section 140A or otherwise,—

(i) interest shall be calculated in accordance with the foregoing provisions of this section up to the date on which the tax is so paid, and reduced by the interest, if any, paid under section 140A towards the interest chargeable under this section;

(ii) thereafter, interest shall be calculated at the rate aforesaid on the amount by which the tax so paid together with the advance tax paid falls short of the assessed tax.

(3) Where, as a result of an order of reassessment or recomputation under section 147 ⁶⁹[or section 153A], the amount on which interest was payable under sub-section (1) is increased, the assessee shall be liable to pay simple interest at the rate of⁷⁰[one] per cent for every month or part of a month comprised in the period commencing on the day following ⁷¹[the date of determination of total income under sub-section (1) of section 143 ⁷²[and where a regular assessment is made as is referred to in sub-section (1) following the date of such regular assessment]] and ending on the date of the reassessment or recomputation under section 147 ⁷³[or section 153A], on the amount by which the tax on the total income determined on the basis of the reassessment or recomputation exceeds the tax on the total income determined ⁷⁴[under sub-section (1) of section 143 or] on the basis of the regular assessment aforesaid.

Explanation.—⁷⁵[* * *]

(4) Where, as a result of an order under section 154 or section 155 or section 250 or section 254 or section 260 or section 262 or section 263 or section 264 or an order of the Settlement Commission under sub-section (4) of section 245D, the amount on which interest was payable⁷⁶ under sub-section (1) or sub-section (3) has been increased or reduced, as the case may be, the interest shall be increased or reduced accordingly, and—

(i) in a case where the interest is increased, the Assessing Officer shall serve on the assessee a notice of demand in the prescribed form specifying the sum payable and such notice of demand shall be deemed to be a notice under section 156 and the provisions of this Act shall apply accordingly;

(ii) in a case where the interest is reduced, the excess interest paid, if any, shall be refunded.

(5) The provisions of this section shall apply in respect of assessments for the assessment year commencing on the 1st day of April, 1989 and subsequent assessment years.]

Detail of Section 234C

⁷⁷[Interest for deferment of advance tax.

234C. (1) ⁷⁸[Where in any financial year,—

(a) the company which is liable to pay advance tax under section 208 has failed to pay such tax or—

(i) the advance tax paid by the company on its current income on or before the 15th day of June is less than fifteen per cent of the tax due on the returned income or the amount of such advance tax paid on or before the 15th day of September is less than forty-five per cent of the tax due on the returned income or the amount of such advance tax paid on or before the 15th day of December is less than seventy-five per cent of the tax due on the returned income, then, the company shall⁷⁹ be liable to pay simple interest at the rate of ⁸⁰[one] per cent per month for a period of three months on the amount of the shortfall from fifteen per cent or forty-five per cent or seventy-five per cent, as the case may be, of the tax due on the returned income;

(ii) the advance tax paid by the company on its current income on or before the 15th day of March is less than the tax due on the returned income, then, the company shall be liable to pay simple interest at the rate of ⁸¹[one] per cent on the amount of the shortfall from the tax due on the returned income:

Provided that if the advance tax paid by the company on its current income on or before the 15th day of June or the 15th day of September, is not less than twelve per cent or, as the case may be, thirty-six per cent of the tax due on the returned income, then, it shall not be liable to pay any interest on the amount of the shortfall on those dates;

(b) the assessee, other than a company, who is liable to pay advance tax under section 208 has failed to pay such tax or,—

(i) the advance tax paid by the assessee on his current income on or before the 15th day of September is less than thirty per cent of the tax due on the returned income or the amount of such advance tax paid on or before the 15th day of December is less than sixty per cent of the tax due on the returned income, then, the assessee shall be liable to pay simple interest at the rate of ⁸¹[one] per cent per month for a period of three months on the amount of the shortfall from thirty per cent or, as the case may be, sixty per cent of the tax due on the returned income;

(ii) the advance tax paid by the assessee on his current income on or before the 15th day of March is less than the tax due on the returned income, then, the assessee shall be liable to pay simple interest at the rate of ⁸¹[one] per cent on the amount of the shortfall from the tax due on the returned income :]

⁸²[Provided that nothing contained in this sub-section shall apply to any shortfall in the payment of the tax due on the returned income where such shortfall is on account of under-estimate or failure to estimate—

(a) the amount of capital gains; or

(b) income of the nature referred to in sub-clause (ix) of clause (24) of section 2,

and the assessee has paid the whole of the amount of tax payable in respect of income referred to in clause (a) or clause (b), as the case may be, had such income been a part of the total income, as part of the ⁸³[remaining instalments of advance tax which are due or where no such instalments are due], by the 31st day of March of the financial year:]

⁸⁴[Provided further that nothing contained in this sub-section shall apply to any shortfall in the payment of the tax due on the returned income where such shortfall is on account of increase in the rate of surcharge under section 2 of the Finance Act, 2000 (10 of 2000), as amended by the Taxation Laws (Amendment) Act, 2000 (1 of 2001), and the assessee has paid the amount of shortfall, on or before the 15th day of March, 2001 in respect of the instalment of advance tax due on the 15th day of June, 2000, the 15th day of September, 2000 and the 15th day of December, 2000 :]

⁸⁵[Provided also that nothing contained in this sub-section shall apply to any shortfall in the payment of the tax due on the returned income where such shortfall is on account of increase in the rate of surcharge under section 2 of the Finance Act, 2000 (10 of 2000) as amended by the Taxation Laws (Amendment) Act, 2001 (4 of 2001) and the assessee has paid the amount of shortfall on or before the 15th day of March, 2001 in respect of the instalment of advance tax due on the 15th day of June, 2000, the 15th day of September, 2000 and 15th day of December, 2000.]

⁸⁶[Explanation.—In this section, "tax due on the returned income" means the tax chargeable on the total income declared in the return of income furnished by the assessee for the assessment year commencing on the 1st day of April immediately following the financial year in which the advance tax is paid or payable, as reduced by the amount of,—

(i) any tax deductible or collectible at source in accordance with the provisions of Chapter XVII on any income which is subject to such deduction or collection and which is taken into account in computing such total income;

(ii) any relief of tax allowed under section 90 on account of tax paid in a country outside India;

(iii) any relief of tax allowed under section 90A on account of tax paid in a specified territory outside India referred to in that section;

(iv) any deduction, from the Indian income-tax payable, allowed under section 91, on account of tax paid in a country outside India; and

(v) any tax credit allowed to be set off in accordance with the provisions of section 115JAA ⁸⁷[or section 115JD].]

(2) The provisions of this section shall apply in respect of assessments for the assessment year commencing on the 1st day of April, 1989 and subsequent assessment years.]]

Income Tax :- Advance Tax due on 15th December 2014

Friends,  15th Dec.2014 is very close to us. All income tax assessee should aware about payment of Advance Income Tax in time  to avoid interest and penalty charges due to Less or Non Payment of Advance Income Tax.  Specifically Senior Citizens who have not any business income are exempted for payment of Advance Income Tax.  Keeping in view various issues regarding Advance Tax , the following article helps the assessee to understand the complete Advance Income Tax matters.

If the Income Tax Liability of any taxpayer is more than Rs. 10,000 in a financial year, then he is liable to pay such tax in installments during the year itself rather than paying this tax at the end of the year. This tax which is payable during the year is called “Advance Tax” or “pay as you earn tax” as tax is liable to be paid at the time the income is earned i.e. during the year rather than paying this tax at the end of the year.

Advance Tax receipts help the Govt. to receive a constant flow of tax receipts throughout the year so that expenses can be incurred rather than receiving all tax payments at the end of the year. Advance Tax is liable to be paid by all assesses like Salaried, Self Employed, Businessman etc. before the filing of Income Tax Return

For Individuals with Salary as the sole source of income, Advance Tax would be taken care of by the TDS deducted by the employer at the time of payment of salaries as reflected in Form 16and thus there would hardly be any Advance Tax payable. Senior Citizens not having any Business Income are also exempted from the payment of Advance Tax (Introduced by Budget 2012)

For all taxpayers earning income from any source other than salary, Advance Tax is payable in installments as explained below.

Payment of Advance Tax

Advance Tax is liable to be paid as per the following schedule

In case of Assessees other than Companies

Due Date of Installment	Amount Payable
On or before15th Sep	Not less than 30% of the Advance Tax Liability
On or before15th Dec	Not less than 60% of the Advance Tax Liability as reduced by the amount,if any, paid in earlier installment
On or before15th Mar	100% of the Advance Tax Liability as reduced by the amount, if any, paid in earlier installments

In case of Companies

Due Date of Installment	Amount Payable
On or before 15th June	Not less than 15% of the Advance Tax Liability
On or before 15th Sept	Not less than 45% of the Advance Tax Laibility as reduced by the amount, if any, paid in earlier installment
On or before 15th Dec	Not less than 75% of the Advance Tax Laibility as reduced by the amount, if any, paid in earlier installments
On or before 15th March	100% of the Advance Tax Liability as reduced by the amount, if any, paid in earlier installments

Payment of Advance Income Tax is to be made through Challan No. 280 by selecting Advance Tax (100) as the type of payment as shown below:-

Computation of Advance Tax

Advance Tax is liable to be paid by estimating the current year income and then applying the tax rates as per the Income Tax Slabs in force. The Advance Tax shall be computed as under:

	Income under the 5 Heads of Income	xxx
(Less)	Brought Forward Losses and Allowances	xxx
(=)	Gross Total Income	xxx
(Less)	Chapter VI-A Deductions	xxx
(=)	Estimated Total Income	xxx

	Income Tax on Estimated Total Income	xxx
(Add)	Surcharge (if any) on the above Estimated Income	xxx
(=)	Total Tax Payable	xxx
(Less)	Relief under section 89	xxx
(=)	Tax Liability	xxx
(Add)	2% Education Cess	xxx
(Add)	1% SHEC	xxx
(=)	Total Tax Liability	xxx
(Less)	Relief of tax u/s 90,90A,91	xxx
(Less)	MAT Credit u/s 115JAA	xxx
(Less)	TDS as shown in Form 16/Form 16A and reflected in Form 26AS	xxx
(=)	Advance Tax Liability	xxx

Payment of Advance Tax in case of Capital Gains

Although Advance Tax is liable to be paid on all incomes including Capital Gains, it is practically not possible to estimate the Capital Gains which may arise in an year. Therefore, in such cases, it is provided that if any such income arises after the due date of any installment, then, the entire amount of tax payable on such capital gain (after claiming exemption under section 54) shall be paid in remaining installments of Capital Gains which are due. If the entire amount of tax payable is so paid, then no interest on late payment will be levied.

Interest on Late Payment of Advance Tax

If the Income Tax is not payable as per the above schedule, Interest is liable to be paid for late payment of tax as follows

1. Interest under section 234C – Interest @ 1% per month is payable if the tax is not paid as per the above schedule i.e. for Deferment in Installments of Advance Tax
2. Interest under section 234B – Interest @ 1% is payable if 90% of the tax is not paid before the end of the financial year i.e. for Default in Payment of Advance Tax

For computing Interest u/s 234A/B/C and any other Interest, Income Tax shall be rounded off to nearest hundred and fraction of hundred shall be ignored

Interest under section 234C for Deferment of Payment of Tax

Interest under section 234C is liable to be paid @ 1% per month if

(a)	Advance Tax paid on or before 15th Sept	<	30% of the Tax Due on Returned Income
		OR
(b)	Advance Tax paid on or before 15th Dec	<	60% of the Tax Due on Returned Income
		OR
(c)	Advance Tax paid on or before 15th Mar	<	Tax Due on Returned Income
		OR
(d)	No Tax has been paid by the Assessee

Note: Tax Due on Returned Income means the Tax on Total Income declared in

	Income Tax Return	xxx
(Less)	Relief of Tax u/s 90	xxx
(Less)	Relief of Tax u/s 90A	xxx
(Less)	Relief of Tax u/s 91	xxx
(Less)	MAT Credit u/s 115JAA	xxx
(Less)	TDS Paid	xxx
(=)	Tax due on Returned Income	xxx

COMPUTATION OF INTEREST FOR LATE PAYMENT OF ADVANCE TAX U/S 234C

The following computations have been shown for all assessees other than companies. Computation for Companies shall be done in the same manner as for assessees other than companies as shown below taking into the account the difference in the due dates.

Computation of Interest under Section 234C for Non-Company Assessees

(a)	Rate	1% per month simple interest
	Period	3 Months
	Amount	30% of the “Tax due on Returned Income”
		(Less)   Advance Tax paid on or before 15th Sep

(b)	Rate	1% per month simple interest
	Period	3 Months
	Amount	60% of the Amount Due on Returned Income
		(Less) Advance Tax Paid on or before 15th Dec

(c)	Rate	1% per month simple interest
	Period	1 Month
	Amount	Tax Due on Returned Income
		(Less) Advance Tax paid on or before 15th March

Interest under section 234B for Default in Payment of Tax

Interest @ 1% per month is payable if

(a)	Advance Tax Paid by the Assessee during the Previous r	<	90% of the Assessed Tax
		OR
(b)	No Advance Tax is paid by the Assessee

Note: Assessed Tax means

	Tax determined u/s 143(1) or on Assessment u/s 143(3)/144/147/153A	xxx
(Less)	Relief of Tax u/s 90	xxx
(Less)	Relief of Tax u/s 90A	xxx
(Less)	Relief of Tax u/s 91	xxx
(Less)	MAT Credit u/s 115JAA	xxx
(Less)	TDS/TCS	xxx
(=)	Assessed Tax	xxx

In case Advance Tax paid by the Assessee is more than his actual Income Tax Liability, he can claim Refund of Income Tax by furnishing the details of tax deposited in the Income Tax Return

Income Tax :- Extension in Due Date for Payment of Advance Income Tax in March 2014

Friends,    Central Board of Direct Taxes has extended due date of payment of advance tax to be made on 15th March, 2014 to 18th March, 2014 for the Financial Year 2013-14 for all the assessees (Corporate and other then Corporates).  This extension has been done vide CBDT order No. F.No. 385/8/2013-IT(B) dated 14th March, 2014.

Copy of orders are given below for the satisfaction :-

Income Tax :- Advance Tax Payment on 15th March, 2014

Friends, 

               15-03-2014 is Last date for payment of Advance Tax for the Financial Year 2013-14 or Assessment Year 2014-15.   All assessee who are liable to pay advance tax should deposit Advance Income Tax in time.  In case advance income tax is not deposited in time,  penalty in the shape of Interest is to be charged by Income Tax Department. 

                      Keeping in view all things today is 4th installment for Corporate Cases and 3rd installment for Non-Corporate Cases. 

To read more regarding Payment of Advance Income Tax (Click Here)

Download simple Advance Income Tax Calculator

Pay Advance Tax up to 15/12/2013 (15th December, 2013)

Advance Payment of Tax [Section 207 to 219]

1. Advance tax is payable in respect of all income including capital gains and casual income.

2. Under section 208, obligation to pay advance tax arises in every case where the advance tax payable is Rs. 10,000 or more.

In case of senior citizens who have passive source of income like interest, rent, etc., the requirement of payment of advance tax causes genuine compliance hardship. Therefore, in order to reduce the compliance burden on such senior citizens, exemption from payment of advance tax has now been provided to a resident individual-

(1) not having any income chargeable under the head “Profits and gains of business or profession”; and

(2) of the age of 60 years or more. 

Such senior citizens need not pay advance tax and are allowed to discharge their tax liability (other than TDS) by payment of self-assessment tax.

Limit for payment of advance tax : An assessee who is liable to pay advance tax of less than Rs. 10,000 will not be saddled with interest under sections 234B and 234C for defaults in payment of advance tax. However, the consequences under section 234A regarding interest for belated return shall continue. 

No need for filing estimate: An assessee has to estimate his current income and pay advance tax thereon. He need not submit any estimate or statement of income to the Assessing Officer, except where he has been served with notice by the Assessing Officer.         

Where obligation to advance tax has arisen, the assessee shall himself compute the advance tax payable on his current income at the rates in force in the financial year and deposit the same whether or not he has been earlier assessed to tax.

In the case of a person who has been already assessed by way of a regular assessment in respect of the total income of any previous year, the Assessing Officer, if he is of the opinion that such person is liable to pay advance tax, can serve an order under section 210(3) requiring the assessee to pay advance tax. For this purpose, the total income of the latest previous year in respect of which the assessee has been assessed or the total income returned by the assessee for any subsequent previous year, whichever is higher, shall be taken as the basis for computation of advance tax payable.

The above order can be served by the Assessing Officer at any time during the financial year but not later than the last date of February.

If, after sending the above order, but before 1st March of the financial year, the assessee furnishes a return relating to any later previous year or an assessment is completed in respect of a later return of income, the Assessing Officer can amend computation on the income to returned or assessed.

If assessee feels that his own estimate of advance tax payable would be less than the one sent by the Assessing Officer, he can file estimate of his current income and advance tax payable thereon. Where the advance tax payable or assessee’s estimation would be higher than the tax computed by the Assessing Officer, then the advance tax shall be paid based upon such higher amount. 

No reduction of ‘tax deductible but not deducted’ and ‘tax collectible but not collected’, while computing advance tax liability

(i) As per the provisions of section 209, the amount of advance tax payable by a person is computed by reducing the amount of income-tax which would be deductible or collectible at source during the financial year from any income which has been taken into account in computing the total income.

(ii) Some courts have opined that in case where the payer pays any amount (on which tax is deductible at source) without deduction of tax at source, the payee shall not be liable to pay advance tax to the extent tax is deductible from such amount.

(iii) With a view to make such a person (payee) liable to pay advance tax, a proviso has been inserted in section 209(1)(d). Accordingly, the amount of tax deductible at source but not so deducted by the payer shall not be reduced from the income tax liability of the payee for determining his liability to pay advance tax.

(iv) In effect, only if tax has actually been deducted at source, the same can be reduced for computing advance tax liability of the payee. Tax deductible but not so deducted cannot be reduced for computing advance tax liability of the payee.

(v) Similarly, only if tax has actually been collected at source, the same can be reduced for computing advance tax liability of the buyer or licensee or lessee. Tax collectible but not so collected cannot be reduced for computing advance tax liability of the buyer or licensee or lessee.

If the last date for payment of any installment of advance tax is a day on which the receiving bank is closed, the assessee can make the payment on the next immediately following working day and in such cases, the mandatory interest leviable under section 234B and 234C would not be charged.

Where advance tax is payable by virtue of the notice of demand issued by the Assessing Officer, the whole or the appropriate part of the advance tax shall be payable in the remaining installments.

Where the assessee does not pay any installment by the due date, he shall be deemed to be an assessee-in-default in respect of such installment.

Download excel based Advance Tax calculator (Click Here )

Income Tax : Advance Tax Due on 15th Sep, 2013 (15-09-2013)

Advance Payment of Tax [Sections 207 to 219]

Liability for payment of advance tax

(1) Tax shall be payable in advance during any financial year, in accordance with the provisions of sections 208 to 219, in respect of an assessee’s current income i.e. the total income of the assessee which would be chargeable to tax for the assessment year immediately following that financial year [Section 207].

(2) Under section 208, obligation to pay advance tax arises in every case where the advance tax payable is ` 10,000 or more.

Note -

An assessee who is liable to pay advance tax of less than ` 10,000 will not be saddled with interest under sections 234B and 234C for defaults in payment of advance tax. However, the consequences under section 234A regarding interest for belated filing of return would be attracted.

(3) In case of senior citizens who have passive source of income like interest, rent, etc., the requirement of payment of advance tax causes genuine compliance hardship. Therefore, in order  to reduce the compliance burden on such senior citizens, exemption from payment of advance tax  has now been provided to a resident individual-

(1) not having any income chargeable under the head “Profits and gains of business or  profession”; and

(2) of the age of 60 years or more. Such senior citizens need not pay advance tax and are allowed to discharge their tax liability (other than TDS) by payment of self-assessment tax.

Computation of advance tax

(1) An assessee has to estimate his current income and pay advance tax thereon. He need not submit any estimate or statement of income to the Assessing Officer, except where he has been served with notice by the Assessing Officer.

(2) Where an obligation to pay advance tax has arisen, the assessee shall himself compute the advance tax payable on his current income at the rates in force in the financial year and deposit the same, whether or not he has been earlier assessed to tax.

(3) In the case of a person who has been already assessed by way of a regular assessment in respect of the total income of any previous year, the Assessing Officer, if he is of the opinion that such person is liable to pay advance tax, can serve an order under section 210(3) requiring the assessee to pay advance tax.

(4) For this purpose, the total income of the latest previous year in respect of which the assessee has been assessed by way of regular assessment or the total income returned by the assessee in any return of income for any subsequent previous year, whichever is higher, shall be taken as the basis for computation of advance tax payable.

(5) The above order can be served by the Assessing Officer at any time during the financial year but not later than the last date of February.

(6) If, after sending the above notice, but before 1st March of the financial year, the assessee furnishes a return relating to any later previous year or an assessment is completed in respect of a later return of income, the Assessing Officer may amend the order for payment of advance tax on the basis of the computation of the income so returned or assessed.

(7) If the assessee feels that his own estimate of advance tax payable would be less than the one sent by the Assessing Officer, he can file estimate of his current income and advance tax payable thereon.

(8) Where the advance tax payable on assessee’s estimation is higher than the tax computed by the Assessing Officer, then, the advance tax shall be paid based upon such higher amount.

(9) In all cases, the tax calculated shall be reduced by the amount of tax deductible at source.

No reduction of ‘tax deductible but not deducted’ while computing advance tax liability

(i) As per the provisions of section 209, the amount of advance tax payable by a person is computed by reducing the amount of income-tax which would be deductible at source during the financial year from any income which has been taken into account in computing the total income.

(ii) Some courts have opined that in case where the payer pays any amount (on which tax is deductible at source) without deduction of tax at source, the payee shall not be liable to pay advance tax to the extent tax is deductible from such amount.

(iii) With a view to make such a person (payee) liable to pay advance tax, the proviso to section 209(1)(d) provides that the amount of tax deductible at source but not so deducted by the payer shall not be reduced from the income tax liability of the payee for determining his liability to pay advance tax.

(iv) In effect, only if tax has actually been deducted at source, the same can be reduced for computing advance tax liability of the payee. Tax deductible but not so deducted cannot be reduced for computing advance tax liability of the payee.

(10) The amount of advance tax payable by an assessee in the financial year calculated by -

(i) the assessee himself based on his estimation of current income; or

(ii) the Assessing Officer as a result of an order under section 210(3) or amended order under section 210(4) is subject to the provisions of section 209(2), as per which the net agricultural income has to be considered for the purpose of computing advance tax.

Installments of advance tax

(1)   Advance tax shall be payable schedule of installments:

Companies - Four installments

Due date of installment

On or before the 15th June

On or before the 15th September

On or before the 15th December

On or before the 15th March

Non-corporate assessees - Three Due date of installment

On or before the 15th September On or before the 15th December

On or before the 15th March

and due dates by companies and other assessees as per the following Amount payable

1. Not less than 15% of advance tax liability.
2. Not less than 45% of advance tax liability, as reduced by the amount, if any, paid in the earlier installment.
3. Not less than 75% of advance tax liability, as reduced by the amount or amounts, if any, paid in the earlier installment or installments.

The whole amount of advance tax liability as reduced by the amount or amounts, if any, paid in the earlier installment or installments.

installments Amount payable

1. Not less than 30% of advance tax liability
2. Not less than 60% of advance tax liability, as reduced by the amount, if any, paid in the earlier installment.
3. the whole amount of such advance tax as reduced by the amount or amounts, if any, paid in the earlier installment or installments.

(2) The last date for payment of the whole amount of advance tax is 15th March of the relevant financial year. However, any amount paid by way of advance tax on or before 31st March is also considered as advance tax paid for the financial year. Interest liability for late payment will arise in such a case.

(3) If the last day for payment of any installment of advance tax is a day on which the receiving bank is closed, the assessee can make the payment on the next immediately following working day, and in such cases, the mandatory interest leviable under sections 234B and 234C would not be charged.

(4) Where advance tax is payable by virtue of the notice of demand issued under section 156 by the Assessing Officer, the whole or the appropriate part of the advance tax specified in such notice shall be payable on or before each of such due dates as fall after the date of service of notice of demand.

(5) Where the assessee does not pay any installment by the due date, he shall be deemed to be an assessee in default in respect of such installment.

Payment of advance tax in case of capital gains/casual income [Proviso to section 234C]

(1) Advance tax is payable by an assessee on his/its total income, which includes capital gains and casual income like income from lotteries, crossword puzzles etc.

(2) Since it is not possible for the assessee to estimate his capital gains, income from lotteries, etc., it has been provided that if any such income arises after the due date for any installment, then, the entire amount of tax payable (after considering tax deducted at source) on such capital gains or casual income should be paid in the remaining installments of advance tax which are due.

(3) Where no such installment is due, the entire tax should be paid by 31st March of the relevant financial year.

(4) No interest liability would arise if the entire tax liability is so paid.

Note: In case of casual income (winnings from lotteries, crossword puzzles, card games, gambling, betting, races including horse races etc.), the entire tax liability is fully deductible at source@30% under section 194B and 194BB. Therefore, advance tax liability would arise only in respect of the education cess and secondary and higher education cess element of such tax, if the same, along with tax liability in respect of other income, if any, is ` 10,000 or more.

Credit for advance tax [Section 219]

Any sum, other than interest or penalty, paid by or recovered from an assessee as advance tax, is treated as a payment of tax in respect of the income of the previous year and credit thereof shall be given in the regular assessment.

Interest for non-payment or short-payment of advance tax [Section 234B]

(1) Interest under section 234B is attracted for non-payment of advance tax or payment of advance tax of an amount less than 90% of assessed tax.

(2) The interest liability would be 1% per month or part of the month from 1st April following the financial year upto the date of determination of income under section 143(1).

(3) Such interest is calculated on the amount of difference between the assessed tax and the advance tax paid.

(4) Assessed tax is the tax calculated on total income less tax deducted at source.

Interest payable for deferment of advance tax [Section 234C]

(1) Interest under section 234C is attracted for deferment of advance tax beyond the due dates.

(2) The interest liability would be 1% per month, for a period of 3 months, for every deferment.

(3) However, for the last installment of 15th March, the interest liability under this section would be 1% for one month.

(4) The interest is to be calculated on the difference between the amount arrived at by applying the specified percentage of tax on returned income and the actual amount paid by the due date.