Use this intuitive tool from ClearTax to calculate your advance tax liability:
Advance tax is the income tax that is paid in advance instead of lump sum payment at year end. It is the tax that you pay as you earn. These payments have to be made in instalments as per due dates provided by the income tax department. Watch this video to find out more.
Salaried, freelancers and businesses– If your total tax liability is Rs 10,000 or more in a financial year you have to pay advance tax. The advance tax applies to all taxpayers, salaried, freelancers, and businesses.
Senior citizens– People aged 60 years or more, and do not run a business, are exempt from paying advance tax. So only senior citizens (60 years or more) having business income must pay advance tax
Presumptive income for businesses–The taxpayers who have opted for the presumptive taxation scheme under section 44AD have to pay the whole amount of their advance tax in one instalment on or before 15 March. They also have the option to pay all of their tax dues by 31 March.
Presumptive income for professionals– Independent professionals such as doctors, lawyers, architects, etc. come under the presumptive scheme under section 44ADA. They have to pay the whole of their advance tax liability in one instalment on or before 15 March. They can also pay the entire amount by 31 March.
Read in detail about presumptive taxation here Want a CA to calculate and help pay your advance tax dues?
FY 2022-23 for both individual and corporate taxpayers
|Due Date||Advance Tax Payment Percentage|
|On or before 15th June||15% of advance tax|
|On or before 15th September||45% of advance tax less advance tax already paid|
|On or before 15th December||75% of advance tax less advance tax already paid|
|On or before 15th March||100% of advance tax less advance tax already paid|
For taxpayers who have opted for Presumptive Taxation Scheme under sections 44AD & 44ADA – Business Income
|Due Date||Advance Tax Payment Percentage|
|On or before 15th March||100% of advance tax|
Our tax experts will calculate your advance tax liability so you can pay your dues on time.
Watch this video to find out more.
Interest on advance tax:
Non-payment of advance tax will attract interest under 234B: As per Section 234B, you must pay at least 90% of the total taxes as advance tax by 31st March. Failure to make advance tax payments will result in an interest @ 1% on the unpaid amount.
Delay in payment of advance tax will attract interest under 234C:
Rate of Interest
Period of Interest
Amount on which interest is calculated
If Advance Tax paid on or before June 15 is less than 15%
1% per month
15% of Amount* (-) tax paid before June 15
If Advance Tax paid on or before September 15 is less than 45%
1% per month
45% of Amount* (-) tax paid before September 15
If Advance Tax paid on or before December 15 is less than 75%
1% per month
75% of Amount* (-) tax paid before December 15
If Advance Tax paid on or before March 15 is less than 100%
1% per month
100% of Amount* (-) tax paid before March 15
We will explain the calculation by way of an example. Ajay is a freelancer earning income from the profession of interior decoration. For the FY 2022-23, Ajay estimates his annual gross receipts at Rs 20,00,000. Ajay estimates his expenses at Rs 12,00,000. Ajay has deposited Rs 40,000 in PPF account. Ajay has also paid Rs 25,000 towards the LIC premium. Further, Ajay has paid Rs 12,000 towards the medical insurance premiums. Professional receipts of Ajay are subject to TDS. Ajay estimates a TDS of Rs 30,000 on certain professional receipts for the FY 2022-23. Besides professional receipts, Ajay estimates an interest of Rs 10,000 on fixed deposits held by him. Ajay’s advance tax liability would be as below:
|INCOME ESTIMATION FOR ADVANCE TAX||AMOUNT (Rs)||AMOUNT (Rs)|
|Income from profession:|
|Income from other sources:|
|Interest from fixed deposit||10,000|
|GROSS TOTAL INCOME||8,10,000|
|Less: Deduction under section 80C|
|Contribution to PPF||40,000|
|Deduction under section 80D||12,000||77,000|
|Add: Education cess @ 4%||2,364|
|TAX PAYABLE IN ADVANCE||31,464|
|ADVANCE TAX PAYMENTS|
|Due date||Advance tax payable||Amount (Rs)|
|15th June||15% of Advance tax||4,700|
|15th September||45% of Advance tax||14,100|
|15th December||75% of Advance tax||23,600|
|15th March||100% of Advance tax||31,400|
If your tax liability for a year after reducing TDS exceeds Rs 10,000, you will be liable for payment of advance tax
An NRI, who has an income accruing in India in excess of Rs 10,000, is liable for payment of advance tax.
Resident senior citizens not having income from business or profession are not liable for advance tax.
Non payment of advance tax will result in levy of interest under 234B and 234C of the Income tax Act, 1961.
Yes. You can consider all these deductions while estimating your income for the year for computing your advance tax liability.
You can still go ahead with payment of advance tax on or before the 31 March of the year. Such payment will still be treated as advance tax only.
Advance tax payment is made using Challan 280 just like any other regular tax payment. You may read our detailed article on online payment of income tax.
Advance tax payments benefit both the government and the individual/organisation paying it. From the government’s perspective, it provides a continuous flow of income throughout the year. From the individual/organisation’s perspective, it reduces the year-end burden of paying taxes in a lump sum. Non-payment of advance tax could result in the taxpayer being liable to interest under the Income Tax law. Hence, timely payments of advance tax should be made.
To check the status of your advance tax payment challan, 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.incometaxindiaefiling.gov.in/home and going to My account -> View Form 26AS (Tax Credit), and entering the financial year and type of view/download.
Taxpayers can pay advance tax both online and offline. For offline payments, the challan can be downloaded at https://www.incometaxindia.gov.in/Forms/107010000000345598.pdf Once downloaded, the details listed should be filled up, keeping in mind the following instructions-
To view the advance tax payment challan, 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.
Use the advance tax calculator by ClearTax to simplify your advance tax calculations and click on ‘Pay on Government Website’ button to make the payment. To know the detailed steps, watch this video.
You must pay advance tax before the financial year ends in 4 instalments: 15th June, 15th September, 15th December and 15th March. If advance tax is not paid according to this schedule, then 1% monthly interest will be levied.
You must pay advance tax on Capital gains. However, it is not possible to accurately predict the amount of capital gain in advance. Therefore, if you earn capital gains after the advance tax due date, you may choose to pay the advance tax in the remaining instalments.
Use the advance tax calculator to calculate your exact tax amount and click on ‘Pay on Government Website’ button > Select ‘challan 280’ > Fill up all the details (watch this video for complete details) > Under net banking, select ‘SBI’ and make the payment.
To pay advance tax through HDFC bank, follow these steps: