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Rules 2026

Advance Tax — instalments and due dates

Advance tax applies when your estimated annual tax liability exceeds ₹10,000. Here are the four instalment due dates, how to calculate your payment, and what interest applies for late payment.

Introduction

Advance tax means paying your income tax in instalments during the financial year rather than in one lump sum after the year ends. The Income Tax Act 2025 requires advance tax when your estimated tax liability exceeds ₹10,000. This applies to all income types — salary, business, profession, and property — after accounting for TDS deductions.

Paying on time avoids interest charges. Missing instalments triggers simple interest at 1% per month on the shortfall under Section 234C of the Income Tax Act 2025.

Key facts

Who must pay

Advance tax applies to every taxpayer — salaried, freelance, business, or professional — if the estimated tax liability after TDS deductions exceeds ₹10,000 for the financial year.

Due dates by instalment

Advance tax is paid in four instalments: 15 June (15%), 15 September (45%), 15 December (75%), and 15 March (100%). The March instalment can be paid up to 31 March without interest.

Interest for late payment

If you miss an instalment, interest under Section 234C of the Income Tax Act 2025 applies. The interest rate is 1% per month on the shortfall from the due date. Paying on time avoids any interest charge.

Self-assessment after filing

If advance tax paid is less than the final tax liability, you must pay the balance as self-assessment tax before filing your ITR. Use the income tax challan ITNS 280 with '(Self-Assessment Tax)' selected.

Advance tax instalment schedule

Instalment Due date Cumulative % of estimated tax
1st instalment 15 June 15% of annual estimated tax
2nd instalment 15 September 45% of annual estimated tax
3rd instalment 15 December 75% of annual estimated tax
4th instalment 15 March (or 31 March) 100% of annual estimated tax

Frequently asked questions

How is advance tax calculated for a salaried person?
Estimate your total annual income from all sources, subtract the standard deduction, applicable deductions under the new or old regime, and TDS already deducted. The remainder, multiplied by the applicable slab rate, is your estimated tax. If it exceeds ₹10,000, you must pay advance tax in instalments.

Can a salaried employee avoid advance tax?
If your only income is salary and TDS is properly deducted by your employer each month, you may not need to pay advance tax separately. The employer deducts tax based on your estimated annual income. However, if you have other income (rent, interest, freelance), you may still need to pay advance tax on that additional income.

How do I pay advance tax online?
Use the income tax challan ITNS 280 on the NSDL website or through net banking. Select '(Advance Tax)' as the payment type, enter your PAN, assessment year, and bank account details. After payment, the amount appears in Form 26AS within 2–3 working days.

What happens if I do not pay advance tax?
If your advance tax payable is more than ₹10,000 and you do not pay it, interest under Section 234C applies on the shortfall. The interest is simple interest at 1% per month or part of a month from the due date of each instalment up to the date of filing the return.

Is advance tax the same as TDS?
No. TDS (Tax Deducted at Source) is tax deducted by the payer of your income — your employer, bank, or tenant. Advance tax is tax you pay yourself based on your estimated total tax liability. TDS is a credit against your final tax bill; advance tax is a prepayment of that bill.

Sources

Sources: Income Tax Act 2025 (Section 234C) · Income-tax Rules 2026 · CBDT advance tax circulars · Income Tax Department guidance (verified 2026-10-07). Last reviewed by FinWiz24 Research Desk.