Advance Tax Filing Last Date: What will happen if you miss advance tax deadline?

Advance Tax Filing Deadline: We often hear that a particular businessman or a movie actor has paid advance tax worth crores. But many of us don't know if normal tax and advance tax are the same. Do employed persons also have to advance tax? Are the tax slabs for normal tax and advance tax the same? Are the deadlines for normal tax and advance tax the same? What if somebody misses the deadline to pay advance tax? Know the answers to these queries amid the Income Tax Department's (I-T) advance tax e-campaign, which is asking taxpayers to deposit the due amount by March 15, the deadline to pay advance tax. 

Advance Tax Filing Deadline: What is advance tax?

Advance tax is a type of income tax that has to be deposited with the Income Tax Department before the end of the financial year. It is not paid in lump sum on an annual basis, like normal tax, but is deposited in instalments. Taxpayers need to pay advance tax in June, September, December, and March. Under advance tax, taxpayers deposit taxes in advance with the Income Tax Department. The last date to pay the fourth and final instalment of advance tax is March 15.

Advance Tax Filing Deadline: Who has to pay advance tax?

Advance tax has to be paid by salaried people, businesses, and freelancers with an estimated tax liability of more than or equal to Rs 10,000. However, if your age is more than 60 years and you have no income from any kind of business or profession, you are exempted from advance tax.

Advance Tax Filing Deadline: How much advance tax has to be paid?

Even though advance tax is paid in installments, it is calculated for the entire year. You will have to calculate in advance how much tax you may have to pay in a year. After removing deductions from your income, you can calculate advance tax on the remaining income as per your tax slab.

After this, you will have to pay at least 15 per cent of your advance tax by June 15; 45 per cent by 15 September; 75 per cent by 15 December; and 100 per cent by 15 March.

Advance Tax Filing Deadline: What will happen if advance tax is not paid?

If you are employed and changing job, TDS is often not deducted properly by the companies and advance tax liability is created. In such a situation, you will have to check and deposit advance tax. If you fail to pay tax on time, you will be charged late fees. Besides, you will also have to pay interest on unpaid tax. Thus, your tax liability along with late fees and interest can be quite high.