Advance Tax under the Income-tax Act 2025 – Who Pays, Due Dates and Instalments
- Advance tax is payable when the tax payable for the financial year is ₹10,000 or more (section 404).
- Four instalments: 15% by 15 June, 45% by 15 September, 75% by 15 December, 100% by 15 March – each cumulative (section 408).
- Tax that your employer or others deduct at source is taken into account (section 405).
- Some assessees under the presumptive scheme pay the whole amount by 15 March.
Advance tax means paying income-tax during the year, as you earn, instead of in one lump at the end. Most salaried employees never need to – the employer deducts tax at source under section 392 – but anyone with significant other income should know the rules.
Who must pay – section 404
Advance tax is payable during a financial year where the amount of tax payable for that year, as computed under this Part, is ₹10,000 or more.
How the amount is worked out – section 405
Section 405 uses the formula A = B − C: B is the income-tax on your estimated income at the rates in force for the financial year and C is the tax that is deductible or collectible at source during the year on income already counted in that estimate (subject to the conditions in the section). In plain words – tax on your income, minus tax that will be deducted at source – and if the balance is ₹10,000 or more, advance tax is due. You can also pay on your own accord (section 406) or in response to an Assessing Officer's order (section 407).
Due dates – section 408(1)
| Instalment | Due on or before | Amount payable (cumulative) |
|---|---|---|
| 1st | 15 June | Not less than 15% of the advance tax |
| 2nd | 15 September | Not less than 45%, less what was paid earlier |
| 3rd | 15 December | Not less than 75%, less what was paid earlier |
| 4th | 15 March | The whole advance tax, less what was paid earlier |
Example. Suppose the advance tax for the year works out to ₹40,000. Pay at least ₹6,000 by 15 June (15%), at least a total of ₹18,000 by 15 September (so ₹12,000 more), at least a total of ₹30,000 by 15 December (₹12,000 more), and the remaining ₹10,000 by 15 March.
Special case – presumptive taxation
Under section 408(2), an assessee who declares profits and gains under section 58(2) (Table Sl. 1 or 3) pays the whole advance tax in one instalment on or before 15 March.
Payments up to 31 March
Under section 408(3), any advance tax paid on or before 31 March is treated as paid during the financial year ending on that day for all purposes of the Act.
What if you miss the dates?
The Act charges interest for deferment or short payment of advance tax – see sections 424 and 425 of the Act. Read the text before relying on this summary.
Related reading
- How salary tax is deducted: our Form 130 guide.
- Filing the return after the year: the return due-date guide.
Still have a question? Ask TAXBADI – get an answer from the Act, Rules and forms, with the exact sections cited.
More guides
- Arrears of Salary – Relief under Section 157, Rule 73 and Form No. 39 (Old 89(1))
- Capital Gains Tax Rates 2026-27 – Shares, Mutual Funds and Property under the New Act
- Clubbing of Income – Section 99: When Spouse or Minor Child Income Is Added to Yours
- Filing Income Tax Return Late – Fee under Section 428 and Interest under Sections 423 to 425
This guide is for general information and is not tax advice. Tax figures are before health and education cess unless stated. The law and the official notifications are the final authority – see our Disclaimer. Found a mistake? Tell us.