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ADVANCE TAX ELIGIBILITY AND APPLICABILITY

ADVANCE TAX ELIGIBILITY AND APPLICABILITY

WHAT IS ADVANCE TAX ELIGIBILITY AND APPLICABILITY

Advance tax defines as income tax should be paid in advance instead of a lump-sum payment at the end of the year. It is also called as pay as you earn tax. The payments have to be made in installments as per the due dates provided by the IT department.

Who should pay Advance Tax?

Salaried, businesses, and freelancers – If your total liability of tax is Rs 10,000 or more in a financial year you have to pay advance tax. Advance tax is applicable on all assessments whether having income from salary, business, and freelancing. Senior citizens, who attain the age of 60 years or older, and do not run a business or have any source for business are exempt from this provision.

Tax for Presumptive Businesses–The taxpayers who have selected for presumptive taxation scheme under sec 44AD of Income Tax Act, have to pay the whole amount of their advance tax in one installment i.e. on or before 15 March. They also have another option to pay all of their tax dues by March 31st.

Presumptive Scheme for Professionals– Independent professionals such as doctors, lawyers, chartered accountants, etc. come under the presumptive scheme under section 44ADA. They have to pay the whole of their advance tax liability in a single installment that is on or before 15 March. They can also pay the total tax liability by 31 March.

Due Dates of Advance Tax payment

For individual and corporate taxpayers

Due Dates

Advance Tax payable

On or before 15th June

15% of Advance Tax

On or before 15th Sept

45% of Advance Tax (calculate after deducting the amount already paid against the advance tax)

On or before 15th Dec

75% of Advance Tax (calculate after deducting the amount already paid against the advance tax)

On or before 15th March

100% of Advance Tax (calculate after deducting the amount already paid against the advance tax)

For taxpayers who are under section 44AD & 44ADA – Business Income

Due Dates

Advance Tax payable

On or before 31stth June

100% of Advance Tax

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26 Apr

Lalita Sharma
Lalita Sharma

"Ideas are easy but Implementation is Hard”. Neusource is the platform for making a right choice in every aspect of business that helps to grow your business and give assistance in each vital advance which causes your beginning up to create in each most ideal manner

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