Understanding Advance Tax Rules in India (Section 208)
Under Section 208 of the Income Tax Act, every individual, professional, freelancer, and corporate assessee whose estimated net tax liability for the financial year exceeds ₹10,000 (after accounting for TDS and TCS credits) is mandated to pay taxes in advance in quarterly installments rather than waiting until ITR filing season.
Statutory Quarterly Installments & Due Dates
For standard taxpayers, the payment schedule is divided into four milestones across the financial year:
- 15th June: Minimum 15% of total estimated advance tax.
- 15th September: Minimum 45% of total estimated advance tax (less earlier paid amount).
- 15th December: Minimum 75% of total estimated advance tax (less earlier paid amounts).
- 15th March: 100% of total advance tax payable.
Note: Taxpayers opting for presumptive taxation under Section 44AD or 44ADA are permitted to pay 100% of their advance tax in a single installment on or before 15th March.
Frequently Asked Questions
Are senior citizens required to pay Advance Tax?
Resident senior citizens aged 60 years or above who do not have any income chargeable under the head "Profits and Gains of Business or Profession" are fully exempt from paying advance tax.
What happens if I miss an Advance Tax deadline?
Missing a quarterly deadline or underpaying triggers interest penalties under Section 234C at 1% per month for the period of shortfall. If less than 90% of the tax is paid by 31st March, additional 1% monthly interest under Section 234B applies from 1st April until the date of payment.
How can I pay Advance Tax online?
Advance tax is paid through the e-Filing portal of the Income Tax Department under Challan 280, selecting Tax Applicable as "(0021) Income Tax (Other than Companies)" and Type of Payment as "(100) Advance Tax".