Advance Tax: Liability, Instalments, Online Payment and Interest – myITreturn Help Center

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FY 2025-26: Sections 208, 211, 234B and 234C, Income-tax Act, 1961
Tax year 2026-27: Sections 404, 408, 424 and 425, Income-tax Act, 2025

Advance tax is income tax paid during the financial year instead of waiting until return filing. It generally applies when the estimated tax payable, after reducing eligible TDS and TCS, is ₹10,000 or more.

Who Is Liable?

Individuals, HUFs, firms, companies and other taxpayers may be liable if the estimated net tax is at least ₹10,000. A resident individual aged 60 years or more who does not have income from business or profession is generally not required to pay advance tax.

Advance-tax Instalments

Due date	Cumulative amount payable
15 June	At least 15% of advance tax
15 September	At least 45%
15 December	At least 75%
15 March	100%

Presumptive taxation: Eligible taxpayers using sections 44AD or 44ADA may pay 100% of advance tax by 15 March. Tax paid up to 31 March is still treated as advance tax.

How to Estimate Advance Tax

Estimate income under all heads for the year.
Reduce eligible deductions and exemptions.
Apply the selected tax regime, slab rates and special rates.
Add surcharge and health and education cess, where applicable.
Reduce eligible TDS, TCS, relief and tax credits.
Pay instalments based on the remaining estimated liability.

How to Pay Online

Open e-Pay Tax on the Income-tax e-Filing portal.
Enter PAN and complete authentication or log in first.
Select Income Tax and the correct financial year/assessment year.
Select the advance-tax payment type.
Enter tax, surcharge and cess accurately.
Choose the payment mode and complete payment.
Download the challan receipt and verify it in payment history.

Year selection matters: A payment for FY 2025-26 must be mapped to AY 2026-27 under the 1961 Act. Income earned from 1 April 2026 belongs to tax year 2026-27 under the 2025 Act.

Interest for Shortfall or Delay

Provision	When it applies	Rate
Section 234B / section 424	Advance tax was not paid or was less than 90% of assessed tax.	Simple interest at 1% per month or part of a month.
Section 234C / section 425	Required instalments were not paid on time.	1% per month, generally for three months for the first three instalments and one month for the March instalment.

Example

Estimated net tax is ₹1,00,000. The taxpayer should cumulatively pay ₹15,000 by June, ₹45,000 by September, ₹75,000 by December and ₹1,00,000 by March. If only ₹70,000 is paid by year-end, section 234B may apply because payment is below 90% of assessed tax. Section 234C may also apply to delayed instalments.

Review estimates regularly: Recalculate after a bonus, capital gain, business-profit change, dividend or other unexpected income. Later instalments can be increased to reduce further interest.

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