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Deadline To Make First Installment Of Advance Tax Payment Draws Closer

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The deadline to make the first deposit or installment towards advance tax payment for the financial year 2019-20 is 15 June. If you are an individual tax payer with an estimated tax liability of over Rs 10,000, you may be required to pay advance tax.

If you required to pay advance tax, do it before the deadline to avoid interest on the due amount.

Who are required to pay advance tax?
  
 

Who are required to pay advance tax?

Individual tax assessees whose estimated tax liability in a financial year exceeds Rs 10,000 are required to pay advance tax according to section 208 of the Income Tax Act.

If you are salaried income individual with no other source of income, you need not worry about advance tax as the employer (your company's finance department) will make the necessary deduction on your behalf and make the payment to the Income Tax Department.

For those with income from interest earned on bank deposits, capital gains from mutual funds, shares, residential properties, etc will have to make advance tax payment.

According to section 207 of the Income Tax Act, advance tax is not applicable on resident senior citizens who do not have any income from business or profession.

Earnings from rental income, pension, interest on bank deposits and dividends are not considered for advance tax, in case of senior citizens.

How to calculate advance tax and pay it?
  

How to calculate advance tax and pay it?

You can visit the IT department's website which has an advance tax calculator that will help you evaluate your advance tax liability. List out the income earned till date and tax liability to arrive at a number.

You need not submit any document or estimate but just have to pay the advance tax either online or offline.

Advance tax deadlines
  

Advance tax deadlines

Taxpayers are required to make the advance income tax payment in four equal installments in a financial year.

By 15 June, one needs to deposit 15 percent of the tax liability, 45 percent by 15 September, 75 percent by 15 December and complete payment for the year by 15 March of the following calendar year.

Those who file income tax under the Presumptive Taxation Scheme (PTS) need to pay the entire advance tax in a single installment on or before 15 March.

Read more about: advance tax
Story first published: Wednesday, June 12, 2019, 15:35 [IST]
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