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? Browse the Money Blog for worked guides.
Written by Gurjeet Singh, Sharpen Solutions. Last reviewed 30 Sep 2026. How we check these numbers.