As per the nature of taxes, you earn your income first and then pay taxes. However, in case of advance taxes, you pay your estimated tax liability before the end of a financial year. That said, you are eligible to pay advance tax only if you receive income from more sources other than your salary. These could include another profession, side-business, capital gain, fixed deposit interest, lottery, rent, etc. Also, advance tax is payable only when the overall tax liability should be more than ₹10,000.

Steps to pay Advance Tax

Below are the steps for payment of Advance Tax online:

1) Visit the URL https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp and select challan number ITNS 280.

2) Select Tax Applicable (0021) Income-Tax (Other Than Companies).

      (a) Select (100) Payment of Advance tax as a type of payment.

      (b) Select the mode of payment and the bank through which the payment has to be done.

      (c) Enter your Pan number.

      (d) Select Assessment Year (take precaution here and re-confirm your selection).

      (e) Fill in your contact details.

      (f) Enter captcha code and click on proceed.

3) Verify the details entered and click on the button “Submit to the bank”.

4) Log in to your retail/personal net banking account to make the payment.

5) Enter the total tax amount in the field basic tax and click on the button Submit/Make payment.

6) After a few moments of tax payment you get a challan counterfoil with bank details - BSR code, Challan number, Challan Date and Challan amount. Please keep it safe for future reference.

Who has to pay advance tax?

The following people have to pay advance taxes:

1. Salaried, freelancers and business firms whose overall tax liability is more than Rs. 10,000 in a financial year. However, people above 60 years of age are exempt for advance tax.

1. Professionals and business taxpayers who opted for presumptive taxation scheme under Section 44AD of the Income Tax Act, 1961. The entire advance tax is to be paid in one instalment on or before 15 March. These taxpayers also have a choice to pay their tax liability by 31 March.

Created & Posted by Pooja

Income Tax Expert at TAXAJ

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