Blog Post

Advance Tax

Advance Tax
Hurry up!! First Advance Tax instalment due on 15th June’2016

By C.A Pratik Anand

Any person whose tax liability during the year exceeds Rs. 10,000/- is required to pay Advance Tax to the Central Govt.

The Central Govt. had amended advance Tax provisions by way of an amendment in budget’2016.

From FY 2016-17 i.e AY 2017-18 onwards all assessees are required to pay advance tax in four instalments starting from 15th June.

Earlier only corporate assesees paid advance tax in four instalments and non-corporate assesseespaid advance tax in three instalments only but from FY 2016-17/AY 2017-18 onwards all assessees including Individuals, HUF, partnership firms, LLPs, companies etc. are required to pay advance tax in 4 instalments starting from 15th June of the Financial Year. 

 

The due dates for payment of advance tax for all persons except persons covered under section 44AD for FY 2016-17/AY 2017-18will be:
Due Date Instalment Payable
 On or before 15th Jun, 2016  Not less than 15% of advance tax.
 On or before 15th  Sep, 2016  Not less than 45% of advance tax as reduced by the amount paid in the earlier instalment.
 On or before 15Th Dec, 2016  Not less than 75% of advance tax as reduced by the amount paid in the earlier instalments.
 On or before 15Th Mar, 2017  The whole amount (100%) of advance tax as reduced by the amount paid in the earlier instalments.

 

The Budget ‘2016 also amended provisions related to payment of Advance Tax by persons covered under Section 44AD. Earlier, the persons covered under section 44AD were not required to pay advance tax but from FY 2016-17/AY 2017-18 onwards the persons covered u/s 44AD are also required to pay 100 % advance tax in one instalment on or before 15th March of the financial year.

Advance Tax Liability for persons covered under section 44AD of the I.T. Act 1961
Due Date Installment Payable
On or before 15th Jun, 2016
On or before 15th  Sep, 2016
On or before 15Th Dec, 2016
On or before 15Th Mar, 2017  The whole amount (100%) of advance tax as reduced by the amount paid in the earlier instalments (if any).

 

Notes:

  • Senior citizens above the age of 60 years and who do not have business income are not required to pay advance tax.
  • Advance Taxprovisions are applicable to both residents as well as non-residents.
  • Advance Tax is to be paid through challan ITNS 280.
  • Failure to pay advance tax will subject the assessee to interest u/s 234B and 234C of the Income Tax Act’1961.
  • Advance tax paid on or before 31st March shall also be treated as advance tax paid for all purposes.
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