Advance Tax Payment
In some cases, it is mandatory to pay the income tax in advance during the financial year as you earn or expect to earn. The advance tax was introduced with the aim of increasing the revenue inflows during the financial year instead of after the financial year.
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How do we help you paying advance tax
Advance tax payment is crucial for managing your income tax obligations throughout the financial year. It ensures compliance with legal requirements while helping you avoid interest or penalties. Our firm provides end-to-end assistance in understanding, calculating, and paying advance tax tailored to your financial profile. Below is a detailed explanation of our services in this area:
- For Salaried Individuals: Evaluate salary, investments, and additional income like interest, rent, or capital gains.
- For Business Owners and Professionals: Analyze turnover, profits, and applicable deductions while considering fluctuations in income during the year.
- For Other Entities (Companies, HUFs, etc.): Calculate tax based on gross income, MAT (Minimum Alternate Tax), or other applicable provisions.
Advance Tax
Situations when you have to pay advance tax:
i. You are salaried but have high income from interest or capital gains or rental income
ii. You are a freelancer
iii. You are running a business
How to determine and allow deductions?
Reduce deductions you want to claim from your total income and arrive at your taxable income on your tax return. The deductions that come under Section 80C, 80D, 80E or any other you want to claim.
How to Calculate and Pay Advance Tax?
Add income from all sources. Include salary income, interest income, capital gains etc., just like you do at the time of filing your income tax return. If you are a freelancer, estimate your annual income from all clients, and deduct expenses from it. Rent of your workplace, internet bills, mobile bills, depreciation on computers, travel expenses etc. are some expenses.
How to calculate the tax due on total income?
Apply the latest income tax slab rates on your taxable income to calculate your income tax due. Reduce any TDS that may have been deducted from your total tax due. And make sure you have paid according to these instalments. You can make these payments online.
Our CAs can calculate your advance tax liability and help you with paying it online. Seeing a large tax outgo? Don’t worry, our CAs can help calculate your freelancing income and make sure your taxes are optimized.
Due Dates for Payment of Advance Tax
FY 2019-20 & FY 2018-19 for both individual and corporate taxpayers
| Due Date | Advance Tax Payable |
|---|---|
| On or before 15th June | 15% of advance tax |
| On or before 15th September | 45% of advance tax less advance tax already paid |
| On or before 15th December | 75% of advance tax less advance tax already paid |
| On or before 15th March | 100% of advance tax less advance tax already paid |
For taxpayers who have opted for Presumptive Taxation Scheme under section 44AD & 44ADA – Business Income
| Due Date | Advance Tax Payable |
|---|---|
| On or before 15th March | 100% of advance tax |
Our Tax Experts will calculate your advance tax liability so you can pay your dues on time.
Who should pay Advance Tax?
-
Salaried, freelancers and businesses– If your total tax liability is Rs 10,000 or more in a financial year you have to pay advance tax. Advance tax applies to all taxpayers, salaried, freelancers, and businesses. Senior citizens, who are 60 years or older, and do not run a business, are exempt from paying advance tax.
Presumptive income for Businesses–The taxpayers who have opted for presumptive taxation scheme under section 44AD have to pay the whole amount of their advance tax in one instalment on or before 15 March. They also have an option to pay all of their tax dues by 31 March.
Presumptive income for Professionals– Independent professionals such as doctors, lawyers, architects etc. come under the presumptive scheme under section 44ADA. They have to pay the whole of their advance tax liability in one instalment on or before 15 March. They can also pay the entire amount by 31 March.
Legalixo Support in transitioning a Advance Tax
- Purchase a Plan for Expert Assistance
- Add Queries Regarding the conversion
- Provide Documents to Legalixo Expert
- Complete all other required Actions
- Get your work done!
Advance Tax
Situations when you have to pay advance tax:
i. You are salaried but have high income from interest or capital gains or rental income
ii. You are a freelancer
iii. You are running a business
How to determine and allow deductions?
Reduce deductions you want to claim from your total income and arrive at your taxable income on your tax return. The deductions that come under Section 80C, 80D, 80E or any other you want to claim.
How to Calculate and Pay Advance Tax?
Add income from all sources. Include salary income, interest income, capital gains etc., just like you do at the time of filing your income tax return. If you are a freelancer, estimate your annual income from all clients, and deduct expenses from it. Rent of your workplace, internet bills, mobile bills, depreciation on computers, travel expenses etc. are some expenses.
How to calculate the tax due on total income?
Apply the latest income tax slab rates on your taxable income to calculate your income tax due. Reduce any TDS that may have been deducted from your total tax due. And make sure you have paid according to these instalments. You can make these payments online.
Our CAs can calculate your advance tax liability and help you with paying it online. Seeing a large tax outgo? Don’t worry, our CAs can help calculate your freelancing income and make sure your taxes are optimized.
Due Dates for Payment of Advance Tax
FY 2019-20 & FY 2018-19 for both individual and corporate taxpayers
| Due Date | Advance Tax Payable |
|---|---|
| On or before 15th June | 15% of advance tax |
| On or before 15th September | 45% of advance tax less advance tax already paid |
| On or before 15th December | 75% of advance tax less advance tax already paid |
| On or before 15th March | 100% of advance tax less advance tax already paid |
For taxpayers who have opted for Presumptive Taxation Scheme under section 44AD & 44ADA – Business Income
| Due Date | Advance Tax Payable |
|---|---|
| On or before 15th March | 100% of advance tax |
Our Tax Experts will calculate your advance tax liability so you can pay your dues on time.
Who should pay Advance Tax?
-
Salaried, freelancers and businesses– If your total tax liability is Rs 10,000 or more in a financial year you have to pay advance tax. Advance tax applies to all taxpayers, salaried, freelancers, and businesses. Senior citizens, who are 60 years or older, and do not run a business, are exempt from paying advance tax.
Presumptive income for Businesses–The taxpayers who have opted for presumptive taxation scheme under section 44AD have to pay the whole amount of their advance tax in one instalment on or before 15 March. They also have an option to pay all of their tax dues by 31 March.
Presumptive income for Professionals– Independent professionals such as doctors, lawyers, architects etc. come under the presumptive scheme under section 44ADA. They have to pay the whole of their advance tax liability in one instalment on or before 15 March. They can also pay the entire amount by 31 March.
Legalixo Support in transitioning a Advance Tax
- Purchase a Plan for Expert Assistance
- Add Queries Regarding the conversion
- Provide Documents to Legalixo Expert
- Complete all other required Actions
- Get your work done!
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