What is the Advance Tax?
Advance tax is income tax paid during the year rather than at the end. Anyone whose liability after TDS exceeds ₹10,000 must pay it in four instalments — including salaried people with significant capital gains, rental or freelance income.
Missing instalments triggers interest under Section 234C (deferment) and 234B (shortfall), each at 1% a month.
Formula & worked example
15 Dec: 75% cumulative · 15 March: 100%
Advance tax = Total tax − TDS
Worked example: a ₹2,50,000 liability with ₹50,000 of TDS leaves ₹2,00,000 of advance tax. Instalments are ₹30,000 by 15 June, ₹60,000 more by 15 September, ₹60,000 by 15 December and the final ₹50,000 by 15 March.
How to use this advance tax calculator
- Enter your estimated total tax for the year.
- Subtract TDS already deducted by employers or clients.
- Enter anything already paid as advance tax.
- Follow the instalment schedule to avoid 234B and 234C interest.
Smart tips
- Senior citizens without business income are exempt from advance tax entirely.
- Capital gains are hard to forecast — pay the tax on them in the instalment immediately following the sale.
- Paying the full amount by 31 March avoids 234B interest even if earlier instalments were missed.
- Presumptive taxpayers under 44AD/44ADA pay 100% in a single instalment by 15 March.
- Over-paying is safe — the excess comes back as a refund with interest under Section 244A.
Frequently asked questions
Who has to pay advance tax?
Anyone whose tax liability after TDS exceeds ₹10,000 in a financial year, including salaried individuals with large capital gains or rental income.
What are the advance tax due dates?
15 June (15%), 15 September (45% cumulative), 15 December (75%) and 15 March (100%).
What is the penalty for missing advance tax?
Interest at 1% per month under Section 234C for deferment and Section 234B for shortfall below 90% of liability.
Do senior citizens pay advance tax?
Resident senior citizens aged 60+ without business or professional income are exempt.
Want the theory behind the numbers? Read our advance tax guides on the Money Blog.