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Pay the 2nd Installment of Advance Tax before 15th September

Have you received a notification from the Income Tax department regarding the payment of Advance Tax? Well, fret not, you are not the only one. The ITD has been sending these notifications as a reminder to taxpayers who have paid Advance Tax in the last Financial Year.

The communication also states that the department is maintaining a database to monitor the compliance of the taxpayers. It also contains the details of the Advance Tax paid by the assessees in the last Financial year. 

What is Advance Tax?

Advance Tax is a “pay-as-you-earn” scheme for the periodical payment of your yearly tax in advance. It needs to be paid if your outstanding Tax Liability is INR 10,000 or more. Advance Tax can be paid in 4 equal instalments at an equal time gap.

The following table shows the due date of paying Advance Tax for each quarter

Due Date of Installment Amount Payable
On or Before 15th June 15% of the Advance Tax
On or Before 15th September 45% of the Advance Tax
On or Before 15th December 75% of the Advance Tax
On of Before 15th March 100% of the Advance Tax

The due date to pay the second instalment of Advance Tax is quite near and the ITD had sent this notification as a reminder for people to pay the second instalment of Advance Tax.
Wondering how to calculate Advance Tax? Check out our Advance Tax Calculator

Who has to pay Advance Tax?

Any individual having an outstanding Tax liability of INR 10,000 or more is liable to pay Advance Tax.

Individuals having only salary income usually don’t have to pay advance tax, since their employers deduct TDS. However, what is often overlooked is the fact that if a salaried individual has income from other sources like trading, investment, rent then that person may be liable to pay Advance Tax as well. In other words, having any sort of non-salaried income may make one eligible for paying Advance Tax. 

Advance Tax for Investors & Traders

Traders are liable to pay Advance Tax for their realised profits & gains. However, given that the income of traders keeps changing every month (every day…actually😅), it can be quite difficult to pay the accurate amount of Advance Tax every quarter. So, they can go for either of the following options

Option 1: Estimate incomes for each quarter

Traders can pay Advance Tax at the end of each quarter by estimating their trading income. If they pay more than their actual liability then they can claim a refund while filing their ITR. If they pay less than the actual Tax Liability, an interest of 1% per month or part thereof on the differential amount has to be paid u/s 234C

Option 2: Pay pending Tax on or before 31st March.

Capital gains can be difficult to estimate. Hence, taxpayers can pay Advance Tax on the realised profit for that quarter. However, later on, if the tax liability is more than what they have paid, they can clear up all their dues on or before 31st March to avoid any interests.

Where does Quicko come in?

Calculating and remembering to pay advance Tax can be quite a task. That’s why our Tax Planner is here to help you out.

  • Log in with your broker
  • Add other Incomes & Tax credits
  • Navigate to Planning & then click on Advance Tax
  • Check out how much Advance Tax to pay, due dates & other details
  • Click on Pay

Yep, that’s it. We have made it that easy for you to calculate and pay Advance Tax😎

Need help with Advance Tax? Well, let our experts guide you through.

Want to know more? We would love to hear you out. Just drop in your contact details & message. We will get back to you with applicable plans, discounts and more in light’s speed (okay that might be an exaggeration, but we promise to get back to you fast enough)

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Got Questions? Ask Away!

  1. 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

  2. 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

  3. Hey @Gaurav,

    Once you pay the Advance Tax, you have an option to download the challan. In case you missed downloading it, the tax credit for the same will be reflected in your Form 26AS.

  4. Hey Girimon_Vasudevan,

    When you pay advance tax through our tax planner app, you should download the challan and then you
    need to add the it the advance tax toggle under the tax credits in the tax planner tab to see your tax credits reflected in the appropriate quarter.

  5. Sorry, I didn’t miss the payment. I missed to add it in the tax credit on your portal. I am unable to add it now.

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