Advance Tax Deposit: Today, December 15, marks the final deadline for the third payment of advance tax. Taxpayers are thus reminded of the significance of meeting this deadline to stay compliant and prevent penalties. Advance tax is commonly known as a “pay-as-you-earn” tax. It is mandatory for individuals and businesses whose tax obligation for a financial year surpasses ₹10,000. Prepaid tax is not exclusively for traders or corporations. Employees receiving a salary must also pay advance tax if their projected tax liability post-audit for TDS (tax deduction at source) is greater than ₹10,000 in a financial year. Nonetheless, senior citizen residents without any business or professional income are excluded.
Due date for the third installment of advance tax is December 15
The advance tax system aims to guarantee that taxpayers meet their obligations as they earn income throughout the financial year. For the financial year 2024-25, the due date for the third installment of advance tax is December 15. Although the payment can technically be completed on Monday. For salaried employees, although employers withhold tax at the source, they might not include other sources of income, like interest earned from fixed deposits or capital gains. Taxpayers should consider these incomes when determining their advance tax obligation.
Self-employed persons or enterprises that have chosen the presumptive taxation system, on the other hand, have an alternative structure that permits them to settle the full liability at once by March 15.
Not paying advance tax by the required deadline might result in penalties as per the Income Tax Act. Any deficit or failure to pay incurs interest at a rate of 1% per month, calculated until the amount is settled.
The tax can be deposited through the official Income Tax Department website
Advance tax can be deposited via the official Income Tax Department website: www.incometax.gov.in. Taxpayers must sign in using their PAN, click on “e-Pay Tax,” and pick the appropriate assessment year (2025-26 for FY 2024-25).