Advance Tax Payment: According to the calendar of the Income Tax Department, today is the last date to deposit the second installment of advance tax for the assessment year 2024-25. According to Section 208 of the Income Tax Act, 1961, people whose estimated liability in the financial year 2024-25 may exceed ten thousand rupees can deposit their tax in advance. Let us tell you that people whose age is above 60 years and who do not have any income from business or profession, they will not have to pay advance tax. They have been given tax exemption.
Who will have to pay advance tax
According to advance tax rules, salaried employees, self-employed persons, businesses, trusts and partnership firms falling in the tax slab have to pay. One can pay his advance tax in four installments. In the first installment, 15 percent of advance tax has to be deposited on or before June 15. Whereas, in the second installment, after deducting the amount of tax deposited earlier, 45 percent has to be paid on or before September 15. The Income Tax Department has instructed to pay the third installment of tax on or before December 15. Whereas, the fourth and final installment of advance tax has to be paid on or before March 15. This arrangement has been made by the Income Tax Department to reduce the financial burden and make tax payment easier. If any person or institution falling in the tax slab does not deposit the tax on time, then under Section 234B and 234C of Income Tax, interest penalty at the rate of 1 percent is charged on the total amount of tax payable.
What is advance tax?
Advance tax is a type of tax which is instituted by the Income Tax Department and is meant for the individual or business to pay income tax as per the stipulated time. This applies to individuals or businesses whose income is listed and their taxpayer wishes to see their income in advance in the next financial year. The main objective of advance tax is that the taxpayer gives a part of his income in advance to the government. This provides a reasonable way for the government to accumulate funds during the financial year and helps in securing their corporate income. Advance tax is paid on the basis of various adjustments which are decided by the Income Tax Department. This adjustment is based on the income of the individual or business and decides the income tax deduction rates that they will have to show in order to be eligible for lending in the next financial year. It is the responsibility of the taxpayer to make customized advance tax payments on individualized basis based on combined income, investments, financial gains etc. The main objective of advance tax is that the person or business lends an appropriate part of its income to the government so that it becomes convenient for the government to collect income tax during the financial year.
How to deposit advance tax in Income Tax Department
To deposit advance tax in the Income Tax Department, first go to the official website of the Income Tax Department. After this, now fill the login requirements of your Income Tax or PAN card and log in. After you log in, select the Advance Tax or Advance Tax option on the website. Now you have to fill the necessary information to inform the Income Tax Department about your estimated income. This usually includes the appropriate form or process for estimating your income. To deposit the advance tax amount, you will have to select the option of online payment. You can use your bank account or other suitable payment methods here. Once the payment process is complete, you will receive a payment receipt. Keep this receipt safe which you can present as proof for your finance documents and papers.