18 March 2011
Advance Tax Advance Tax is paid by the income earner during the previous year. The computing of the liability of advance tax is done by estimating the 'total income' for the year, calculating the surcharge and taking into consideration the rebate that will be available. The advance tax is required to be paid in three instalments.
Schedule of Advance Tax: A On or before 15 September Not less than 30% of advance tax. B On or before 15 December Not less than 60% of advance tax as reduced by amount paid earlier. C On of before 15 March Full advance tax as reduced by the amount or amounts if any, paid in earlier instalments.
If the assessee does not pays the advance tax as described above, an interest of 1% is charged per month for 3 months for the deferment of advance tax instalment. If the total amount of advance tax is not paid on or before 15 March, an interest of 1% is charged for one month.
Further, if the total advance tax paid is less than 90% of the advance tax payable, the interest at 1% per month is charged for the shortfall in the advance tax paid for the period commencing from 1 April of the assessment year and ending on the date of payment or assessment, whichever is earlier.
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