Advance tax

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juyalneha (Querist)
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22 January 2014 i am not understanding section 210 of income tax act,pls explain me.
also explain meaning of assessed & returned income.

juyalneha

juyalneha (Querist)
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27 January 2014 i hav yet not received answer of my query...anybody answer plz

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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14 July 2024 Certainly! Let's address your queries one by one:

### Section 210 of the Income Tax Act:

Section 210 of the Income Tax Act pertains to the requirement of advance tax payment by taxpayers. Here’s an explanation of its key provisions:

1. **Advance Tax Payment Requirement**:
- Section 210 mandates that individuals, Hindu Undivided Families (HUFs), companies, and other entities liable to pay income tax are required to estimate their income and pay advance tax in installments during the financial year.
- It specifies the due dates for payment of advance tax installments based on the taxpayer's estimated income.

2. **Applicability**:
- The provision applies to taxpayers whose tax liability after TDS (Tax Deducted at Source) exceeds Rs. 10,000 in a financial year.

3. **Consequences of Non-payment**:
- Failure to pay advance tax or underpayment of advance tax may attract interest under Section 234B and Section 234C of the Income Tax Act.
- Interest is levied on the amount of tax payable and is calculated based on the shortfall in installment payments and the due dates specified.

4. **Compliance Requirements**:
- Taxpayers need to estimate their income correctly and pay advance tax accordingly to avoid interest charges and penalties.

### Assessed Income vs. Returned Income:

1. **Returned Income**:
- **Returned Income** refers to the income declared by a taxpayer in their income tax return filed with the tax authorities.
- It is the total income (comprising income from all sources such as salary, business, capital gains, etc.) for which the taxpayer calculates their tax liability and files the return.
- The returned income is based on the taxpayer's own assessment of their income and deductions for a particular financial year.

2. **Assessed Income**:
- **Assessed Income** refers to the income determined by the tax authorities (Income Tax Department) after processing the taxpayer's return and conducting any necessary scrutiny, assessment, or audit.
- The assessing officer examines the return, verifies the income and deductions claimed, and may make adjustments or additions if discrepancies are found.
- The assessed income may differ from the returned income based on the findings of the assessment process conducted by the tax authorities.

### Key Differences:

- **Returned Income** is the income declared by the taxpayer themselves when filing their tax return.
- **Assessed Income** is the income determined by the tax authorities after verifying and assessing the taxpayer's return.

### Conclusion:

Understanding Section 210 helps taxpayers comply with advance tax payment requirements to avoid interest charges and penalties. Differentiating between assessed and returned income is crucial for understanding the tax assessment process and ensuring accurate tax compliance. If you have specific questions about your own tax situation, consulting with a tax advisor or accountant can provide personalized guidance based on your circumstances and local tax laws.

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