Tax: A major warning for taxpayers: only a few hours remain to pay advance tax..
ITR Advance Tax Deadline 2025: Today is December 15th, and this date is extremely important because taxpayers who fail to pay 75% of their advance tax by midnight tonight may face hefty interest charges. This is the third installment of advance tax for the financial year 2025-26, and it is crucial to pay it on time to avoid penalties under Section 234C of the Income Tax Act. Now, the question is, what exactly is advance tax, and who is required to pay it? Let's understand.
What is advance tax?
Advance tax is a tax that is paid in four installments throughout the financial year, based on the estimated income for the entire year, instead of paying it all at once. Its purpose is to reduce the tax burden at the end of the year and provide the government with regular revenue.
Who is required to pay advance tax?
Individuals whose estimated tax liability for the entire financial year is ₹10,000 or more are required to pay advance tax. However, resident senior citizens aged 60 years or older, whose income does not come from a business or profession, are exempt from paying advance tax.
What happens if the December 15th deadline is missed?
Experts explain that, "Delay or underpayment of advance tax attracts interest at the rate of 1% per month, which is 12% annually. Even a single day's delay can result in a minimum of three months' interest." According to experts, if a taxpayer's advance tax liability is ₹1 lakh and they fail to pay the ₹30,000 due on December 15th, they will have to pay ₹900 in interest even if they pay the next day. Advance Tax Timeline
June 15: 15% of the tax
September 15: 45% of the total tax
December 15: 75% of the total tax
March 15: Remaining tax
How is interest charged for non-payment of advance tax?
Interest may be charged in two ways for non-payment of advance tax:
First - Under Section 234B: If 90% of the total tax is not paid by March 31, interest of 1% per month will be charged on the outstanding amount.
Second - Under Section 234C: If the installments are not paid on time, interest of 1% per month will be charged on the delayed amount.
Experts say that if you are salaried, a freelancer, or involved in a business and your tax liability is more than ₹10,000, do not take the December 15 deadline lightly. By paying 75% of the advance tax on time, you can avoid unnecessary interest and penalties.
Frequently Asked Questions (FAQs) on Advance Tax
1. How to download the Advance Tax Challan?
There are two ways to download the Advance Tax Challan.
First method: If you have made an online payment on the Income Tax e-filing portal, a challan receipt (CRN) is generated after the payment, which you can download.
Second method: You can download the blank Challan ITNS-280 form from the download section of the official Income Tax website and make an offline payment at the bank.
2. How to pay advance tax online?
You can use net banking or a debit card to pay advance tax online. For this, go to the e-Pay Tax section of the Income Tax portal, select Challan ITNS-280, and select the "Advance Tax (100)" option in the tax type. After that, fill in the required information and complete the payment.
3. What is the income limit for advance tax? (What is the income limit for advance tax?)
Advance tax applies to an individual if their total tax liability for the entire financial year is ₹10,000 or more.
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