Online Advance Tax Deposit: How to pay advance tax online for FY 2024-25?

The second advance tax The advance payment must be made before September 15, 2024. You can make the payment online or offline. The advance tax must be paid in four installments, with the deadline being the 15th of the last month of each quarter.

All taxpayers with estimated tax liability of Rs 10,000 or more (after deducting TDS of the previous year) are required to pay tax in advance under section 208 of the Income Tax Act, 1961.

Advance tax: who must pay it and the penalty for not complying with the deadline

What is advance tax?

Income tax paid in advance during the tax year rather than at the end of the year is known as advance tax. Tax laws stipulate the specific time for making these payments. Throughout the tax year, advance tax is paid in installments. Another term for advance tax is “pay as you earn” tax.

Who has to pay the tax in advance?

Under Section 208, any person whose estimated tax liability for the year is Rs. 10,000 or more, shall pay his tax in advance, in the form of ‘advance tax’.

How to pay taxes in advance

Step 1: Visit the Income Tax website https://www.incometax.gov.in/iec/foportal/
Step 2: Click on e-Pay tax, enter the PAN, mobile number and click continue. Enter the OTP received on the registered mobile number
Step 3: Click on Advance Tax
Step 4: Select the assessment year and select the advance tax from the drop-down menu.
Step 5: Enter the tax amount and continue. Select payment options and click continue.
Step 6: Click Pay Now to make your payment.

Who does not have to pay taxes in advance?

However, the income tax department website states that a resident senior citizen, i.e. a person aged 60 years or above during the relevant financial year who did not earn any income from business or profession, is not required to pay tax in advance.

What is the penalty for not making advance tax payments?

Penal interest under sections 234B and 234C is applicable for failure to pay advance tax. Penal interest at the rate of 1% per month or part thereof is applicable under each section. Section 234B is applicable for late payment of advance tax. advance payment of taxes or deficit in tax paymentSection 234C applies in case of non-payment or incomplete payment of advance installments of individual taxes.

Failure to pay advance tax or submit inaccurate estimates of advance tax may result in receipt of a notice from the Income Tax Department. Consequently, failure to pay advance tax may result in the imposition of interest and penalties.

Due dates for advance taxes

• On or before June 15 of each fiscal year, 15% of the advance tax must be paid.
• On or before September 15, 45% of the advance tax (less the tax previously paid) will be due.
• On or before December 15, 75% of the tax advance payment (less the tax already paid) must be paid.
• On or before March 15, 100% of the tax advance payment (less the tax already paid) is due.
• For taxpayers who have opted for the presumptive taxation system, the full amount of the advance tax must be paid.

Benefits of paying taxes in advance

According to Kotak Mahindra’s website, these are the benefits of paying advance tax on time:

• Prepayment of taxes reduces the chances of taxpayers being penalized with interest for failure to pay taxes.
• Paying taxes in installments instead of paying them all at once helps manage finances better. Taxpayers do not have to worry about last-minute tax payments.
• Advance tax payments provide a continuous stream of revenue to the Government throughout the year.