Most of people are confused over advance tax submission. Here we are clearing things about Advance tax, who should pay, how much should pay advance tax, do salaried person need to pay advance tax, business man need to pay advance tax?
What is Advance Tax?
In simple terms, Advance tax means you are paying income tax in advance as your income for particular financial year, is above income tax slab. As per the Section 208 of Income tax Act, 1961, if your estimated tax for Financial year goes above Rs.10000, you need to pay Advance tax.
To give facility, there are facility to pay income tax in 3 installment. 30% income tax need to pay on or before 15th September, 60% by 15th December and 100% by 15th March in every financial year. And if you don’t pay income tax by due date, you have to pay interest for the late submission of income tax. You can into account the taxes deducted at source while paying Advance tax (or income tax).
Do Salaried Person have to pay Advance TAX?
Whoever, salaried person or business man, if your estimated income tax is above Rs.10000, you need to pay advance tax before 15th December, 2015. Just do minus TDS while calculating advance tax (for salaried person).
Who are Exempted from Advance Tax?
If you are senior citizen (according to Section 207 of the Act, above 60 years of age) and you are not earning from business or profession, you don’t need to pay advance tax. Even if you are earning via rental, pension, bank deposit or dividends, you don’t need pay advance tax.
How much interest to be paid for late payment of advance tax?
According to section 234B, Simple Interest of 1%/per month to be paid for late payment of advance tax.
If you have any question or query regarding advance tax, you can ask in the comment below, Thanks.
How to Calculate Advance Tax?
Well, its quite simple. Just go to the official link of income tax india where they have designed the calculator to calculate advance tax. Put your earnings details there and calculate your advance tax. you can visit the official link here http://www.incometaxindia.gov.in/Pages/tools/advance-tax-calculator.aspx
How to Pay Advance Tax?
To pay advance tax, you can now pay online too. Income Tax department of india has designed special portal where you can pay your advance tax. Below is some steps you need to follow before paying advance tax online;
1. Go to https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp and select Challan number 280.
2. After you select the year you wish to pay for advance tax, (assessment year).
3. Fill the basic details, pan card number, bank account details and other details.
4. Choose type of income from 3 option (Advance tax – for regular advance tax payment),Self-Assessment Tax ( for if you are paying taxes for previous financial year), and Tax on Regular Assessment (if demand as been raised by IT dept).
5. After that you will be redirected to payment page (Net Banking Page). Before making you can see all the details you filled, amount,Challan 280.
6. Pay the amount. Add an advance tax details entry at your income tax return page.
Hope this guide will help you to pay your advance tax. Shoot me in comment below, if you need any help.