Steps to make Advance Tax Payment

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Divya Singhvi

Advance Tax
Due date
Tax Payments
TIN NSDL
Last updated on January 31st, 2023

Advance tax is applicable if your tax liability, after deducting prepaid taxes like TDS, and relief, exceeds INR 10,000 in a financial year. It should be paid in the year in which the income is earned. Hence, advance tax is also called a ‘pay-as-you-earn’ tax, and payment should be done at quarterly intervals. The advance tax payment due date is on the 15th of the last month of each quarter.

What are the methods for advance tax payment?

There are 3 methods to pay advance tax.

1) Online via TIN NSDL

2) Offline via Bank Branch

3) Online via IT portal

1. Steps for Online Payment of Advance Tax via TIN NSDL

  1. Access the TIN NSDSL e-payment Portal.

    Visit the TIN NSDL e-payment portal and Select Challan 280.Advance Tax Payment Option

  2. Select the tax applicable and Payment Type.

    Select the Tax Applicable as (0021) Income Tax (Other than Companies). Later, select the type of payment as (100) Advance Tax.

  3. Select the Mode of Payment and name of the Bank.

    Next, select the mode of payment from the different options and the name of your Bank. ITNS-280-Mode-of-payment

  4. Enter the Details asked.

    Enter PAN and Other Details including your email Id and contact number.

  5. Select the Assessment Year.

    After selecting the Assessment Year, enter the captcha and click on Proceed.TIN-PG-3-Select-Assessment-year

  6. Click on “Submit to the bank”.

    Verify the details that were entered and Click Submit. Challan-ITNS-280-Submit

  7. Now you can log in to the net banking account of your bank to make the payment.

    Once you make the payment you will get a challan counterfoil with Bank details. Save it for future reference.

2. Steps for payment of Advance Tax Offline

  1. Visit the bank branch and ask for the applicable tax payment challan form-Challan 280 (in this case).
  2. Fill in the details as required in the form. The details asked in the form are the same as required in the online form.
  3. Go to the relevant bank’s counter and submit the filled-in Challan 280 form along with the money. The tax payment can be made either in cash or by cheque.
  4. Once you give the money and challan and the bank official will give you a receipt by tearing off a portion of the challan, filling in the details of payment, and stamping it.
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3. Steps for Advance Tax Payment online via IT portal

Below are the steps to make online payment via IT portal:

  1. Visit the e-filing portal
  2. Now navigate to e-pay tax
  3. Enter PAN/TAN & Mobile number and verify using OTP
  4. Now select the Income tax category
  5. Add the relevant Assessment year & select advance tax payment under minor head 100 as the type of payment
  6. Further, add tax break-up details
  7. Select the payment mode > continue > pay now
  8. Select I agree to the terms and conditions and click on submit to the bank

Payment can be done through Netbanking, Credit card, Debit card, UPI, Pay at bank counter, RTGS/NEFT, or payment gateway.

Once you have completed the payment by either online or offline method, you should keep the receipts safely as proof of payment. It can approximately take up to 10 days to reflect in your Form 26AS. Your income tax payment should show in your Form 26AS component ‘Part C – Details of Taxes Paid’.

FAQs

I forgot to save my Challan for tax payment, what should I do?

You can know details of Advance tax paid from your Form 26AS. Hence download Form 26AS from the income tax e-filing portal and show the same in your ITR.

What should I do if my bank does not have an online payment facility or is not an authorized bank for E-Tax?

In case your bank does not have an online payment facility or is not an authorized bank then you can make a payment of tax by visiting an authorized bank. Hence, it is not mandatory to hold a bank account with an authorized bank.

What are the benefits of Advance tax payment online?

Paying taxes online saves time and such a facility can be availed easily irrespective of time and place.

Is NRI liable to pay advance tax?

Yes, if income in India exceeds INR10,000. they are liable to pay advance tax.

Got Questions? Ask Away!

  1. Hey @Shweta_Saini

    Advance tax is a ‘Pay as you earn’ tax, so it is required to be paid during the financial year in four different instalments in case your Taxable Liability is more than INR 10,000 for the financial year which stands true for you.

    The due dates for advance tax installments are:

    • 15th June - 15% of the tax liability
    • 15th Sept - 45% of the tax liability
    • 15th Dec - 75% of the tax liability
    • 15th March - 100% of the tax liability

    If you are eligible to pay advanced tax but have not paid advance tax, the penalty will be applicable u/s 234B and 234C.

    Let us know if you have any further questions!

  2. Hi Team, I had assumed that I will be able to pay advanced tax before March because I thought I could go for presumptive tax filing. But now it looks like I cannot opt for a presumptive taxation scheme. So does it mean that I did not pay the advanced quarterly tax that I was supposed to pay?

    If yes, what is the penalty in every case or are there some exceptions to avoid this interest penalty?

    Thanks in advance!

  3. Hey @riya_gupta

    You will be charged an interest penalty under section 234C for the delay/non-payment of advance tax during the year @1% per month on the shortfall amount. Additionally, under Section 234B a penalty interest is imposed on the taxpayers in case the advance tax payment is less than 90% of assessed tax liability during the year.

    You can avoid interest u/s 234B by paying at least 90% of your assessed tax liability by March 15, 2021.

    Hope this helps!

  4. Hey @TeamQuicko

    I have LTCG of more than 7 lakhs from the equity for this year. Is there a way to reduce my tax liability? Also, do I have to pay the tax in advance? If I fail to do so, what will be the penalty/interest percentage I have to pay during my tax filing in 2020?

  5. Hey @ViraajAhuja47, you can set off against non-speculative business loss like F&O for the current year. Long-term capital losses for the previous as well as the current year. Yes, you are required to pay advance tax in case your tax liability is more than INR 10,000 for the FY. The penalties for non-payment of advance tax are:

    Non-payment of Advance Tax u/s 234B 3: Interest at 1% in case the taxpayer fails to pay 90% of the tax liability in the same FY
    Delay in Payment of Advance Tax u/s 234C 1: if there is a delay in tax payment than interest @ 1% is applicable.

  6. Hello @S_P

    Tax paid on or before 31/03/2021 will be considered as advance tax for FY 2020-21. So a trader can determine the profits between 15th March to 31st March and pay the tax on 31st March, there will be no interest levied.

    Hope this helps!

  7. Hi @TEst_Netflix,

    Tax audit is applicable when:

    1. Turnover is above the threshold limit
    2. Profit is >=6% of the turnover

    You can use this tool to determine if tax audit is applicable to you:

    It is always a good practice to file your ITR and report all your financial transactions to avoid notice from the Income Tax Department. Especially after the SEBI and CBDT’s data partnership. If your total income is below the basic exemption limit, you won’t have any tax liability.

  8. Do I have to pay Advance Tax if the TDS for the year is sufficient to cover tax liabliltiy?

    Does Dividend on equity shares attract separate Advance Tax or is it just another source of income?

  9. Hi @vivek25,

    You are liable to pay advance tax if your total outstanding tax liability for the financial year after TDS is above INR 10,000.

    To calculate your advance tax liability you need to add your estimated income for the financial year from all sources including - Salary, House Property, Capital Gains, Business & Profession and other sources.
    Next, subtract all eligible deductions, expenses, and Tax Credit available to you.
    Now, if your outstanding tax liability is above INR 10,000, you need to pay advance tax to avoid penalty u/s 234B and 234C.

    Hope this answers your query :slight_smile:

    You can also use the advance tax calculator to know your advance tax liability under the old and new tax regime

  10. Hi
    When I pay the advance tax through the ZERODHA-QUICKO platform, does it get saved/stored? For example I have paid for Q1. so when I have to pay for Q2, will this be automatically calculated?
    Thanks

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