Second instalment of advance tax due by 15th September 2019

The due date to pay the second instalment of advance tax for FY 2019-20 is the 15th of September 2019. All the taxpayers, whose estimated tax liability is more than Rs 10,000 for the FY, will have to pay advance tax and comply with its provisions. However, an individual being a resident and aged 60 years or above, not having income from business or profession, is not required to pay an advance tax.

Calculation of advance tax is nothing but the pre-assessment of your tax liability on an estimated income to be earned in an FY.  At the beginning of the year, an individual will have to estimate his income based on different sources like rented house property, salary, business or any profession and then calculate taxes according to his rates specified in the Income Tax Act. 

The advance tax liability has to be paid in four instalments to the government. The first instalment is due on 15th June every year, when 15% of the total liability has to be paid. Then by 15th September, 45% of the total liability deducting the amount what was paid in the first instalment. Then by 15th December, 75% of the liability and by 15th March, 100% of it. 

Also Read: Government unlikely to replace the Income Tax Act with direct tax code

One can pay the advance tax through online or offline methods. For making the payment online, visit the income tax department portal and click on ‘e-Pay Tax’. A pop-up window will appear on the screen. Click on ‘Continue to NSDL website’ option and select Challan 280. Once the details of the Challan 280 are filled, one can proceed to payment through net banking or debit card. 

Also, if one wishes to pay the taxes offline, he can visit the designated bank branch and fill the Challan 280 form and pay the tax.

While calculating advance tax liability, all the tax-saving deductions under chapter VI A, such as Section 80C, 80D, 80EE, and 80G will be taken into account. In case, an individual has a self-occupied property and is repaying its loan, he can claim the provisional interest to be paid in the whole year from his estimated income.

If he fails to comply with the due dates of payment, he will have to pay interest on the tax due under section 234B and 234C. 

If your tax liability is more than Rs 10,000 for the FY 2019-20 and you haven’t paid any advance tax till now, you should pay 45% of the tax liability by 15th September 2019 and avoid any interest on delayed payment.