Making advance tax payments easy - everything you need to know : Four Square Payments India

An advance tax payment is a portion of your income tax that is paid in advance before the end of the economic year, also known as "pay as you earn". In this article, we will explain how to complete your tax prepayment in a convenient manner.

How are advance taxes paid and who is required to pay them?

Under Section 208, a person whose projected annual tax liability exceeds Rs. 10,000 is required to pay advance tax within a specified period. Retired persons above 60 years of age (with no source of income) are not required to pay advance tax under Section 207.

Salaried persons, contractors, and individuals and businesses that derive high incomes from sources other than regular income are required to pay advance income tax after deducting expenses or losses.

The Income Tax Department issues Tax Payment Vouchers (TPVs) for payment of advance tax at authorised bank branches.HDFC Bank, ICICI Bank, Reserve Bank of India, Union Bank, SBI Bank, and Agra Bank, among others, are authorised institutions.

Who is eligible to pay the advance tax?

The following are the eligibility conditions for payment of advance tax:

Expected tax liability of Rs. 10,000 and above. Capital gains from share sales. Winning money in lottery.

How do I pay my tax advance online?

Advance tax payments are made electronically to the Income Tax Department. Below are the steps for you to easily pay your tax advances online.

Visit the TIN NSDL portal for e-payment. Select voucher 280 for payment of advance tax. On the next screen, fill in the required details. Tax applicable will be (0021) Income Tax (except Corporate) and Payment Type will be (100) Advance Tax. Select the payment method. You can use debit card or net banking service provided by your bank. Enter your PAN details along with other required personal details like email and phone number. Select the assessment year for which you want to pay the advance tax and click on 'Continue'. Once the payment is completed, you will receive a copy of the voucher with bank details for future reference.

What is Advance Tax Voucher 280?

One can make an electronic payment using Voucher 280 directly on the Income Tax Department website. You need to select this voucher on the website, submit the form and then pay the advance tax online or in person. If you wish to pay in person, you will need to print the Voucher 280 document from the Income Tax Department, fill it out and submit it to your bank.

Advance tax, late payment or interest?

If you fail to pay at least 90% of assessed taxes, you will be charged interest at 1% per month until the taxes are paid in full. Interest is calculated at 1% per month until the tax is fully paid.

If you fail to pay the advance tax instalment, you will be charged interest of Tk. 1% under section 234C of the Income Tax Act.

What are the benefits of paying advance tax?

Paying advance taxes may help individuals relax. If you pay your taxes in advance, you do not have to worry about future financial stress or late payments. It promotes timely collection of taxes. It increases government funds as the government can charge interest on the funds received. It helps organisations to manage their finances efficiently and estimate their annual income.

Refunds of advance tax payments?

If a taxpayer paid more tax than was due, they can file a claim within a year of the end of the year and will receive a refund.

reach a verdict

Advance income tax payments benefit both the State and its citizens. Taxpayers benefit because they do not have to pay large amounts of tax in one lump sum, as the tax is paid in convenient instalments. The procedure also raises revenue for the State by speeding up the collection process and charging interest on the amount collected.

Frequently Asked Questions

Do Non-Resident Indians (NRIs) have to pay advance tax? NRIs with an estimated tax liability of more than Rs 10,000 have to pay advance tax. I forgot to pay the fourth instalment on 15 March, what should I do next? Users who have not paid the fourth instalment on the 15 March deadline can submit it before 31 March. What if your advance tax payment exceeds the entire tax bill amount? The difference between the prepaid tax amount and the total tax liability will be refunded. If the amount of advance tax paid exceeds TP3T 101 of the tax bill, the tax department will pay interest of TP3T 61 per year. What is the best way to pay the advance tax? The easiest way to pay the advance tax is online through Internet banking on the Income Tax Department's website. What is the formula for calculating advance tax payments? Advance tax is arrived at by multiplying the projected annual income by the applicable tax rate. For example, if your total income for the year 2018-19 is Rs. 550,000, your projected tax liability is Rs. 23,400. Why TDS payments are important TDS payments are one of the most stable sources of revenue for the government. The tax collection base has widened as almost everyone has to pay TDS in some way or the other.It is also easier for individuals to pay taxes online as TDS is deducted from their salaries on a regular basis. What is the procedure for paying advance tax? Advance tax can be paid using voucher ITNS 280 with code 100 for small amounts and 0020 for large amounts for corporate tax and 0021 for non-corporate tax.