View quick summary Taxpayers are required to pay tax during the year on the basis of their own computation of income. The advance tax is payable on total income of the year from all sources i.e. salary, business, profession etc. (including capital gain, interest, rental income or lottery/prize money).
The advance tax is payable if it exceeds Rs.10,000 for the year.
In the case of an individual, advance tax needs to be deposited as below:
- 30% of advance tax payable on or before 15th September
- 60% of advance tax payable on or before 15th December
- 100% of advance tax payable on or before 15th March
What is the penalty for not depositing advance tax?
In case of default in payment of advance tax, 1% p. m. interest is paid in addition to the tax payable amount, under section:
- 234B – If you have not paid the advance tax i.e. 90% of total tax payable before 31st March.
- 234C – If you have not paid the installment in time i.e 30% before 15th Sept, 60% before 15 Dec and balance before 15th March.
Who need not deposit advance tax?
If your total tax payable is below Rs 10,000, you are not obliged to deposit advance tax as per income tax laws. Also, if your main source of income is salary and all other income (like interest) has been declared to your employer, there is no need to deposit advance tax. However, salary income needs to be included if salary details under the previous employer are not given to the new company on joining.