How to make Advance Tax Payments online

Advance tax is paid during the financial year when your estimated tax liability exceeds ₹10,000 after adjusting TDS and eligible tax credits.

• Advance tax is generally paid in four instalments.
• The due dates are 15 June, 15 September, 15 December and 15 March.
• The cumulative payment percentages are 15%, 45%, 75% and 100%.
• Taxpayers under sections 44AD or 44ADA generally pay the full amount by 15 March.
• Online payment can be made through the Income Tax e-Filing portal.

• Delayed or insufficient payment may attract interest under sections 234B and 234C.

  
  
  

Advance tax refers to income tax paid in instalments during the financial year. It is also called a pay-as-you-earn system because the tax is paid as income is earned.
It usually applies when your income is not fully covered by tax deducted at source, or TDS. This may include income from a business, profession, rent, capital gains, interest or dividends.
You need to estimate your total income for the year, calculate the applicable tax and deduct available TDS or tax credits. The remaining amount determines whether advance tax is payable.
 

You generally need to pay advance tax when your estimated tax liability exceeds ₹10,000 in a financial year after deducting TDS and other eligible tax credits.
This requirement may apply to:

• Salaried individuals with additional taxable income
• Freelancers and self-employed professionals
• Business owners
• Companies and firms
• Non-residents earning taxable income in India

A salaried individual may need to pay advance tax when TDS does not cover tax on rental income, capital gains, interest or other earnings.
Resident senior citizens aged 60 years or above are generally exempt from advance tax when they do not earn income from a business or profession.
 

Advance tax is usually paid in four instalments during the financial year.

• By 15 June, at least 15% of the estimated tax liability should be paid.
• By 15 September, at least 45% should be paid cumulatively.
• By 15 December, at least 75% should be paid cumulatively.
• By 15 March, 100% of the estimated tax liability should be paid.

The percentages are cumulative. This means each instalment includes the amounts already paid during earlier instalments.
Taxpayers using the presumptive taxation scheme under section 44AD or 44ADA generally need to pay the entire advance tax amount by 15 March.
 

Start by estimating your total taxable income for the financial year. Include income already earned and income expected during the remaining part of the year.
Follow these steps:

1. Estimate income from salary, business, profession, rent, interest, dividends and capital gains.
2. Deduct eligible exemptions from the estimated income.
3. Claim deductions available under the tax regime you have selected.
4. Calculate tax according to the applicable slab rates or tax rate.
5. Add surcharge and health and education cess, where applicable.
6. Deduct TDS, TCS and other available tax credits.
7. Check whether the remaining tax liability exceeds ₹10,000.
8. Pay the amount according to the applicable instalment schedule.

Your income may change during the year. You can revise the estimate before later instalments and adjust the remaining advance tax accordingly.
 

Paying advance tax helps divide your annual tax liability into smaller instalments. This can make tax payments easier to manage during the financial year.
It can also help you:

• Avoid a large tax payment at the time of filing your return
• Improve personal or business cash flow planning
• Reduce the possibility of interest under sections 234B and 234C
• Track your tax obligations during the year
• Lower the outstanding amount at the end of the financial year
• Maintain timely income tax compliance

Paying advance tax does not always mean that no further tax will be payable. Your final liability depends on your actual income, deductions, TDS and eligible tax credits.
 

Delayed payment, non-payment or short payment of advance tax may lead to interest under sections 234B and 234C.
Section 234B may apply when you fail to pay advance tax or when the amount paid is less than 90% of the assessed tax. Interest is generally charged at 1% per month or part of a month on the unpaid amount.
Section 234C may apply when an instalment is delayed or falls below the required cumulative percentage. Interest is generally charged at 1% per month, subject to the applicable rules.
Unexpected income, such as capital gains or dividend income, may receive specific treatment when the related tax is paid in the remaining instalments as permitted under the tax rules.
Interest can increase the final amount payable while filing your income tax return. Reviewing your income estimate before every due date can help reduce this risk.
 

Read more:  ITR U Form

Advance tax can be paid online through the e-Pay Tax service on the Income Tax e-Filing portal.
Available payment methods may include:

• Net banking
• Debit card
• Payment gateway
• UPI
• RTGS
• NEFT

Pay at bank counter, where available
The available options may depend on your bank and the selected payment method. Banks or payment gateways may also apply transaction charges in certain cases.
Offline payment may be available through authorised bank branches. You need to generate the relevant challan and provide accurate details, including PAN, assessment year and payment type.
 

You can pay advance tax online by following these steps:

1. Visit the official Income Tax e-Filing portal.
2. Select the e-Pay Tax option from the homepage or after logging in.
3. Enter your PAN and confirm the details.
4. Verify your mobile number using the OTP received.
5. Select the relevant income tax payment category.
6. Choose the applicable assessment year.
7. Select advance tax as the payment type.
8. Enter the tax, surcharge, cess, interest and other applicable amounts.
9. Choose a payment method, such as net banking, debit card, UPI, RTGS or NEFT.
10. Review the PAN, assessment year, payment type and amount.
11. Complete the transaction through your bank or payment service.
12. Download and save the challan receipt.

The receipt usually contains the Challan Identification Number or payment reference details. Keep it safely for tax filing and future verification.
You can also view completed payments and generated challans in the Payment History section of the e-Pay Tax service.
 

Advance tax allows you to spread your tax liability across the financial year instead of paying a large amount later. By estimating your income, adjusting TDS and following the instalment schedule, you can manage payments more effectively. Using the Income Tax e-Filing portal also makes online payment and record-keeping easier. Missing a due date may attract interest under sections 234B and 234C, so reviewing your liability regularly and paying the correct amount on time is important.