March 15 Advance Tax Payment Deadline: Eligibility and Consequences of Non-Payment

Tax Deadlines Approach for FY 2025-26

As the financial year draws to a close, taxpayers must be aware of key tax deadlines, with March 15 being the last day to pay the final instalment of advance tax for FY 2025-26. Taxpayers with an estimated tax liability exceeding Rs 10,000 must ensure timely payment to avoid interest charges on the outstanding amount.

Who is Required to Pay Advance Tax?

Under Section 208 of the Income Tax Act, all taxpayers with estimated tax liability of Rs 10,000 or more, after deducting tax deductible or collectible at source (TDS/TCS), are required to pay advance tax in four instalments. This applies to all categories of taxpayers, including salaried individuals, freelancers, and businesses. Senior citizens aged 60 years or above are exempt from paying advance tax if they do not have income from business or profession during the financial year.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

Advance Tax Instalment Schedule

The instalment schedule is as follows:

• June 15: Minimum 15% of total tax liability
• September 15: 45% (cumulative) of the advance tax
• December 15: 75% (cumulative) of the advance tax
• March 15: Remaining advance tax balance

Consequences of Missing the Advance Tax Deadline

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

Taxpayers missing the advance tax due dates will have to pay interest under Section 234C at 1% per month for the period of delay. Additionally, interest under Section 234B at 1% per month will apply from April 1 of the Assessment Year until the date of actual payment, if at least 90% of the total assessed tax is not paid by March 31.

Payment of Advance Tax

Taxpayers can pay advance tax through various modes, including online payment, cheque, or demand draft. It is essential to ensure timely payment to avoid interest charges and penalties.