Advance tax is the income tax paid in installments throughout the financial year instead of a lump sum at year-end. It applies to individuals and entities with a net tax liability exceeding ₹10,000 after deducting TDS. Payments are due in four installments: 15% by June 15, 45% by September 15, 75% by December 15, and 100% by March 15. Exceptions include senior citizens without business income and those under the presumptive taxation scheme, who must pay a single installment by March 15. Non-payment or underpayment attracts penal interest under Sections 234B and 234C of the Income Tax Act. Payments can be made online via the Income Tax e-filing portal or offline through bank challans. Taxpayers can verify payment status through the TIN-NSDL portal or Form 26AS. Overpayments are eligible for 6% annual interest from the government. Detailed instructions for offline payments and challan downloads are available on government websites.
Page Contents
- Advance Tax: Payments, Deadlines, and Procedures
- (1) Advance Tax
- (2) Advance tax payment
- (3) Who has to pay advance tax
- 4) What are the due dates of advance tax payments?
- (6) What is the penalty for missing advance tax payment?
- (7) How to make advance tax payments?
- (8) Interest payable by Government to assessee:
- (9) How to check advance tax payment status?
- (10) How to write a cheque for advance tax payment?
- (11) How to download the advance income tax challan?
Advance Tax: Payments, Deadlines, and Procedures
(1) Advance Tax
Advance Tax means paying your income tax in installments throughout the year, rather than all at once at the end of the year. This is also known as pay as you earn tax because you pay as you receive income. The tax laws specify when these installments are due.
(2) Advance tax payment
Every ‘person’ with a net income tax liability exceeding Rs. 10,000 in any financial year, must make advance tax payments. Net tax liability is the estimated tax amount after deducting TDS (tax deducted at source) within the financial year. If your total tax liability after considering TDS is more than Rs. 10,000, you are expected to pay advance tax.
`Person’ as defined u/s 2 of the Income Tax Act, includes :
(i) an individual,
(ii) a Hindu Undivided Family (HUF),
(iii) a company,
(iv) a firm,
(v) an association of persons or a body of individuals,
whether incorporated or not,
(vi) every artificial juridical person,
(vi) a local authority.
(3) Who has to pay advance tax
Persons with a net income tax liability of more than Rs. 10,000 in any financial year are obligated to make advance tax payments. The net tax liability is the estimated tax amount minus the TDS (tax deducted at source) within the financial year.
- As per the Income Tax Act, 1961, persons must make four specific quarterly payments to prevent incurring penal interest.
- These payments are to made between June 15 and March 15 of the financial year, as per Section 211 of the Income Tax Act.
4) What are the due dates of advance tax payments?
Here is a look at when a person is required to pay advance tax and the quantum of advance tax payments.
| Due Date | Quantum of installments of advance tax payments |
| On or before June 15 | 15% of the net estimated tax liability |
| On or before September 15 | 45% of the net estimated tax liability minus advance tax already paid |
| On or before December 15 | 75% of net estimated tax liability minus advances tax already paid |
| On or before March 15 | 100% of net estimated tax liability minus advance tax already paid |
- For example, for the current FY 2024-25 (AY 2025-26), a person is required to pay the first installment of advance tax by June 15, the second installment by September 15, the third installment by December 15 and the final installment by March 15.
- (5) However, not all persons with net income liability above Rs. 10,000 in an FY are required to pay advance tax, as per four installments discussed above. The income tax law allow certain exceptions.
- (5) (a) Should who opt for the presumptive taxation scheme should pay advance tax in one installment, by the 15th of March. Additionally, senior citizens (individuals aged 60 or more) are not required to pay advance tax, if they do not have any income from business or profession.
(6) What is the penalty for missing advance tax payment?
- (6) (a) Penal interest is charged for failing to pay advance tax under sections 234B and 234C. A penal interest of 1% per month or part thereof is imposed in each section.
- (6) (b) Section 234B applies in case of non payment of advance tax or when payment of advance tax is less than 90% of final tax liability. Section 234C applies to the nonpayment or underpayment in the quantum of each advance tax installments.
(7) How to make advance tax payments?
- (7) (a) Payment of advance tax can be made using the income tax department’s e-filing portal. One can make payments online or with an offline bank challan.
- (7) (b) If one chooses the offline bank challan method, one need to download the challan from the e-filing ITR portal first. For online tax payments, one has several options such as debit card, net banking, RTGS/NEFT, UPI and credit card.
- (7) (c) Navigate to e-pay tax on the e-filing portal, select the relevant assessment year, and then choose Advance Tax (100) under the minor head to make the payment.
(8) Interest payable by Government to assessee:
The Central Government shall pay interest at 6% per annum on the amount by which the total sum of advance taxes paid by an assessee during any Financial Year exceeds the amount of assessed tax during the Assessment Year relating to the said Financial Year.
(9) How to check advance tax payment status?
To check the status of your advance tax payment challan, please go to https://tin.tin.nsdl.com/oltas/index.html. Select CIN (Challan Identification Number) Based View. Then enter the required details being asked for, in order to view the status. You can also check the list of advance tax payments made by logging in to your income tax account at- https://www.incometax indiaefiling.gov.in/home and going to My account NI view Form 26AS (Tax Credit), and entering the financial year and type view/download.
(10) How to write a cheque for advance tax payment?
Taxpayers can pay advance tax both online and offline. For offline payments, the challan can be downloaded at https://incometaxindia.gov.in/forms/107010000000345598.pdf. Once downloaded, the details listed should be filled up, keeping in mind the following instructions-
- A separate challan should be used for each type of payment.
- Quoting the Permanent Account Number (PAN) is mandatory. Quoting a false PAN may attract a penalty of Rs. 10,000 as per section 272B of the Income Tax Act, 1961.
- Tax payers should draw/issue the cheque/DDs towards payment of income tax as under —Pay_________________________________ (Name of the bank where the Challan is being deposited) A/c Income-tax.
- Taxpayers should ensure that the bank’s acknowledgement contains the (1) BSR code of the bank branch , (2) the date of deposit of challan, and (3) the challan serial number, as these details will have to be quoted in the Income Tax Return.
(11) How to download the advance income tax challan?
To view the advance tax payment challan, please go to https://tin.tin.nsdl.com/oltas/index.html. Select CIN (Challan Identification Number) Based View. Enter the required details, and click on ‘View’. Once the challan details are displayed on the screen, you can either print out the same or save a screenshot. Taxpayers can also download the advance tax payment receipt/challan by visiting the website of the bank through which the advance tax payment was made. An option will be available to download the advance payment receipt.
