Advance Tax for AY 2018-19
An assesse is required to pay tax during the financial year preceding the assessment year on the basis of his own computation of income. This is called advance tax.
An assesse who is liable to pay advance tax will be required to estimate his current income and pay advance tax thereon without having to submit any estimate or statement of income to the assessing authorities.
After making payment of First/second instalment of advance tax , assesse realises that income is need to be revised than, he may revise the income computed and recalculate advance tax payable and pay remaining instalments of advance tax as per revised income computed.
Computation of advance tax:
Tax can be computed on the current estimated income at the rates in force for during the financial year. From the tax so computed tax deducted / collected at source will be deducted.
Advance tax is not required to pay if the advance tax payable is less than Rs. 10000.
A senior citizen, who is resident individual and whose age is 60 year and above, not having any income from business/profession is not liable to pay advance tax.
Due dates of payment of advance tax and who are required to pay advance tax:
| Due date of payment of advance tax | Every assesse except assesse falling under section 44AD and 44ADA | Assesse falling under Section 44AD and 44ADA |
| On or before 15th June | Not less than 15% of advance tax payable | – |
| On or before 15th September | Not less than 45% of advance tax payable as reduced by the amount paid in the earlier instalment. |
– |
| On or before 15th December | Not less than 75% of advance tax payable as reduced by the amount paid in the earlier instalments. |
– |
| On or before 15th March | The whole amount (100%) of advance tax payable as reduced by the amount paid in the earlier instalments. |
The whole amount (100%) of advance tax payable |
Example:
A, an individual, age 35 years, estimates his income as follows:
Gross total Income Rs.750000
Less: Deduction under section 80C Rs.50000
Net Income Rs.650000
Tax: Rs.42500
Add: Education cess: Rs.850
Add: Secondary and higher education cess: Rs.425
Total Rs.43775
Less: Tax deducted at source Rs.1200
Balance to be paid as advance tax Rs.42575
Advance tax in instalments:
First Instalment = 42575*15/100 = Rs.6386
Second Instalment = 42575*(45-15)/100 = Rs.12772.5
Third Instalment = 42575*(75-45)/100 = Rs.12772.5
Fourth Instalment = 42575*(100-75)/100 = Rs.10644
