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The due date for payment of 4th & final instalment of advance tax for the Financial Year 2017-18 is 15th March 2018. 100% of the estimated advance tax will have to be deposited with the income tax department by this date.

Advance tax will have to be paid by all tax payers with an estimated tax liability of more than Rs. 10,000 per annum. Senior citizens (60+ years) who are not carrying on business are exempt from advance tax.

Advance tax is payable in 4 instalments throughout the year. The amount of advance tax to be paid is as follows

  • On or before 15th June – 15% of advance tax
  • On or before 15th September – 45% of advance tax
  • On or before 15th December – 75% of advance tax
  • On or before 15th March – 100% of advance tax

Please follow the following steps to determine the amount of advance tax to be paid.

  1. Estimate the net taxable income for the financial year 2017-18. Please consider all income tax deductions that you are eligible for and factor in possible disallowances for reasons prescribed in the Income Tax Act, 1961. For example, compute depreciation as per the rates prescribed by the IT Act and not those used to prepare books for reporting to stakeholders.
  2. Estimate the income tax payable on the net taxable income by applying the appropriate tax rate. Please note that some companies may be eligible for a lower rate of tax (25% instead of 30%) and some startups may be eligible for deductions. All these matters have to be factored in before arriving at the estimated tax liability.
  3. Some companies may have to pay tax under ‘Minimum Alternative Tax’ / MAT regime. These companies also have to pay advance tax by 15 March 2018.
  4. Once you have arrived at the income tax liability, reduce the TDS done by your customers & advance tax paid till date to arrive at the net tax payable. 100% of this amount will have to be paid by 15 March 2018.

Please note that non-payment of advance tax could lead to interest at the time of filing tax returns. The rate of interest is 1% per month.

Payment of advance tax will have to be done on – https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp

In case of any questions, please do not hesitate to reach out to us on pavan@bclindia.in or info@bclindia.in or write to us on bclindia.in/contact/

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