New Delhi: The final installment of advance tax for the financial year 2024-25 is due today, March 15. Taxpayers failing to meet the deadline may face penalties, as per the Income Tax Department.
According to the Income-Tax (I-T) Act, 1961, individuals with an estimated tax liability exceeding ₹10,000 in a financial year must pay advance tax. This requirement extends to salaried taxpayers, as tax deducted at source (TDS) by employers covers only salary income, excluding earnings from capital gains, fixed deposits, or rent.
However, senior citizens who do not earn income from business or profession are exempt from paying advance tax. For all others, advance tax is calculated on total income earned during the year, with the final installment due today.
Advance Tax Installments
Advance tax is paid in four installments throughout the financial year:
• June 15 – 15% of total tax liability
• September 15 – 45% of total tax liability
• December 15 – 75% of total tax liability
• March 15 – 100% of total tax liability
Taxpayers must consider all income sources beyond their salary, such as rent, interest, or capital gains, to ensure correct tax payments.
Payment Process & Consequences of Missing the Deadline
To pay advance tax, taxpayers can visit the Income Tax Department’s official website, register using their PAN, and select the ‘e-pay tax’ option, choosing ‘Advance Tax (100)’ as the payment type. The correct assessment year (2025-26) must be selected while making the payment.
While taxpayers who miss the March 15 deadline can still pay by March 31, they will incur a one-month interest penalty under Section 234C of the I-T Act. The law mandates a 1% interest per month on any shortfall in advance tax payments if the amounts paid by each due date—June 15, September 15, December 15, and March 15—are below 12%, 36%, 75%, and 100% of the total tax due, respectively.
To avoid penalties, taxpayers are urged to complete their payments before the deadline.
With IANS inputs