- By Nidhi Giri
- Sat, 15 Mar 2025 12:26 PM (IST)
- Source:JND
Income Tax Alert: The final installment of Advance Tax for FY 2024-25 is due by March 15 2025. "Timely payment ensures your compliance with tax laws and supports the ‘Viksit Bharat Movement,’ driving India’s journey towards self-reliance and prosperity," the Income Tax department said in a post on X (formerly Twitter).
Who Needs To Pay Income Tax
According to Income Tax regulations, those individuals having a total tax liability on income from sources other than salary of over Rs 10,000 for the financial year need to pay tax in advance. Employers deduct and remit advance tax on salary to the income tax department.
However, employers must ensure that they declare their additional income to the employer so that they can deduct the correct TDS. As the tax is already taken care of by the employer, the employees don't need to pay any advance tax. However, in case the tax deducted is less than the actual tax, salary individuals may have to pay huge interest under Sections 234C.
Due Date Advance Tax Liability
On or before 15th June 15 per cent of the assessed tax
On or before 15th September 45 per cent of the assessed tax
On or before 15th December 75 per cent of the assessed tax
On or before 15th March 100 per cent of the assessed tax
How To Calculate Your Advance Tax Due And Pay
You become liable to pay an advance tax when your total tax liability for a financial year is over Rs 10,000. The advance tax liability can be calculated based on the estimated income for the year and paid in installments as per the due dates mentioned above.
According to Dr Surana, the advance tax liability can be calculated as follows:
Step 1: Estimate total income
Determine the total expected income for the financial year, considering all sources, including business or professional income, salary income, capital gains, rental income, other income (such as interest, dividends, etc.)
Step 2: Calculate taxable income
Deduct eligible expenses, exemptions, and deductions available under Chapter VI-A (such as Sections 80C, 80D, etc.) from the total income to arrive at the taxable income. Please note, these deductions are available only under the old tax regime.
Step 3: Calculate tax liability
Apply the applicable income tax slab rates based on the taxpayer’s category (individual, firm, etc.). Further, to arrive at the total tax liability, include surcharge, if applicable, and health and education cess at 4% and reduce any available tax credits, including TDS/TCS and MAT credit (if applicable), to determine the net tax payable.
Step 4: Pay advance tax in instalments
Advance tax must be paid in the installments as mentioned above. You can make this payment online after logging into the income-tax e-filing portal, using Challan No. 280.