An assessee liable to pay advance tax has to keep in mind the due dates applicable::

Due Dates Assessee
Individual/ Non Corporate Corporate
by 15th June not less than 15% of Tax Payable
by 15th Sept not less than 30% of Tax Payable not less than 45% of Tax Payable
by 15th Dec not less than 60% of Tax Payable not less than 75% of Tax Payable
by 15th Mar not less than 100% of Tax Payable not less than 100% of Tax Payable

An assessee who has opted for 44AD i.e. presumptive assessment @ 8% of turnover shall be exempted from payment of advance tax.

Consequences of not paying advance tax on time:

{A} Interest u/s 234B for default in payment of advance tax::

  • If Assessee has not made any payment at all : Simple Interest @ 1% per month is calculated on Tax Payable from 1st April of Assessment Year to date of determination of tax u/s 143(1) or regular assessment, whichever is earlier.
  • If Advance tax paid is less than 90% of Tax Payable : Simple Interest @ 1% per month is calculated on [Tax Payable less. Tax Paid]  from 1st April of Assessment Year to date of determination of tax u/s 143(1) or regular assessment, whichever is earlier.

{B} Interest u/s 234C when advance tax is not paid/ full amount of installments due are not paid::

Individual/ Non Corporate Assessee:

Condition Rate Period Amount
If advance tax paid < 30% of Tax Payable on 15th Sept S.I. @ 1% per month 3 months 30% of (Tax Payable less. advance tax payment made)
If advance tax paid < 60% of Tax Payable on 15th Dec S.I. @ 1% per month 3 months 60% of (Tax Payable less. advance tax payment made)
If advance tax paid < 100% of Tax Payable on 15th March S.I. @ 1% per month 1 month 100% of (Tax Payable less. advance tax payment made)

Corporate Assessee:

Condition Rate Period Amount
If advance tax paid < 12% of Tax Payable on 15th June S.I. @ 1% per month 3 months 15% of (Tax Payable less. advance tax payment made)
If advance tax paid < 36% of Tax Payable on 15th Sept S.I. @ 1% per month 3 months 45% of (Tax Payable less. advance tax payment made)
If advance tax paid < 75% of Tax Payable on 15th Dec S.I. @ 1% per month 3 months 75% of (Tax Payable less. advance tax payment made)
If advance tax paid < 100% of Tax Payable on 15th March S.I. @ 1% per month 1 month 100% of (Tax Payable less. advance tax payment made)

How to pay advance tax?

Advance Tax can be paid online through www.tin-nsdl.com using Challan No./ ITNS 280. It can also be paid by filling challan ITNS 280 and submitting it at designated branches of specified banks. SBI, Corporation bank and ICICI are some of the banks that accept advance tax payments.

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 claim such amount as refund while filing Income Tax Return for that financial year. Interest U/S 244A will be paid by the Income Tax department to the assessee on the excess amount if the excess amount is more than 10% of tax liability.

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