Advance Tax Deadline: The final deadline for submitting the fourth installment of advance tax for the financial year 2025-26 is March 15, 2026. Taxpayers obligated to pay advance tax must ensure that they pay 100% of their total tax liability by this date. Not making payments on time could lead to interest and penalties imposed by the Income Tax Department.
When is advance tax due?
Even if someone files an Income Tax Return (ITR) annually, they may still need to pay advance tax in specific situations. If an individual’s total tax liability for the year surpasses Rs 10,000, and the tax owed after accounting for TDS, TCS, and other tax credits is more than Rs 10,000, they must pay advance tax. However, senior citizens whose income comes solely from pensions or interest and who do not earn any business or professional income are exempt from this requirement.
Who is required to pay advance tax?
Freelancers or consultants
Individuals who have realized capital gains from shares or mutual funds
People receiving rental income
Individuals with interest income from fixed deposits or other investments
Business owners
If a salaried employee’s entire tax liability is already covered by TDS deducted by their employer, they typically do not need to pay advance tax.
Salaried individuals should also remain vigilant.
There are instances where even employed individuals might need to pay advance tax.
For instance, if someone earns profits from the stock market, gains from cryptocurrency, or any additional income during the year, they may need to calculate the tax on that income and pay advance tax accordingly.
Advance Tax Payment Schedule
The advance tax installments for the financial year 2025-26 are scheduled as follows:
June 15, 2025: 15% of the total tax
September 15, 2025: 45% of the total tax
December 15, 2025: 75% of the total tax
March 15, 2026: 100% of the total tax
What happens if it’s late?
If an individual fails to pay advance tax on time, the Income Tax Department can charge interest under sections 234B and 234C. Experts suggest that if additional income suddenly arises mid-year, such as bonuses, dividends, or capital gains, the tax should be added to the next advance tax installment. Tax on income received after March 15th must be paid by March 31st.
