Advance tax, often known as the pay-as-you-earn system, is the practice of paying your taxes before the end of the fiscal year. This mechanism assists the government in ensuring a consistent annual revenue stream. Taxpayers are required to pay the entire amount of their advance tax debt by March 15, 2024, which is the deadline for the final installment of advance tax payment for the fiscal year 2023–2024.
If you get income from sources other than your wage, such as rent or stock gains, you must pay advance tax in advance. This also applies to other types of revenue, such as lottery winnings. Payment options include online banking and specialized banks.
You have the option to modify the amount you pay if your estimated income changes over the year. You can use the National Securities Depository or the online tax payment website run by the Income Tax Department to accomplish this.
You are required to pay advance tax if, throughout a financial year, your total tax liability exceeds Rs 10,000. The advance tax is levied on all taxpayers, including corporations, freelancers, and those on salary.
Individuals who are 60 years of age or older who do not own a business are not required to pay advance tax. Thus, advance tax payment is only required for senior citizens (60 years of age or older) who have business income.
On or before March 15th, taxpayers who have chosen to participate in the presumptive taxation plan under section 44AD are required to pay the entire amount of their advance tax in one installment. They can also choose to settle all of their outstanding taxes before March 31.
Under section 44ADA, independent professions including physicians, attorneys, architects, and so forth are covered by the presumption scheme. By no later than March 15th, they must pay the entire amount owed in advance taxes in one installment. They have the option to pay the whole sum by March 31.
In India, you must complete Challan No. ITNS 280 by the deadline in order to pay advance tax. Make sure you enter your PAN accurately on this form to avoid having your tax deposited in someone else’s name. Furthermore, choose the appropriate assessment year for which the advance payment of tax is being made for the forthcoming fiscal year.
You have to indicate the kind of payment when you make it. It is referred to as advance tax if the tax is paid using projected income for the same fiscal year. The payment is considered a self-assessment tax if it is done after the fiscal year has ended.
You will obtain a Challan Identification Number (CIN) upon completion of payment. It is imperative that you write down this number and utilize it in your income tax return. Additionally, validate that the online payment made through ITNS 280 has been successfully received by checking with the Income Tax department.
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