Calculate Advance Tax Liability

Advance Tax Formula:

\[ Advance Tax = (Estimated Tax - TDS) \times Installment \% \]

Estimated Tax (currency):

TDS (currency):

Installment % (percentage):

Advance Tax:

Unit Converter ▲

Unit Converter ▼

From:	To:

1. What Is Advance Tax Calculation?

Advance tax refers to the system of paying tax on estimated income in installments throughout the financial year, rather than as a lump sum at year-end. It helps in better cash flow management for both taxpayers and the government.

2. How Does The Calculator Work?

The calculator uses the advance tax formula:

\[ Advance Tax = (Estimated Tax - TDS) \times Installment \% \]

Where:

\( Estimated Tax \) — Total estimated tax liability for the financial year
\( TDS \) — Tax Deducted at Source already deducted
\( Installment \% \) — Applicable installment percentage (15%, 45%, 75%, or 100%)

Explanation: The formula calculates the advance tax installment amount by first determining the net tax liability after accounting for TDS, then applying the specific installment percentage.

3. Importance Of Advance Tax Calculation

Details: Proper advance tax calculation ensures timely tax payments, avoids interest penalties under Section 234B and 234C, and helps in better financial planning throughout the year.

4. Using The Calculator

Tips: Enter your total estimated tax liability and TDS amount in currency format. Select the appropriate installment percentage based on the due date (15% by June 15, 45% by September 15, 75% by December 15, and 100% by March 15).

5. Frequently Asked Questions (FAQ)

Q1: Who needs to pay advance tax?
A: Taxpayers whose tax liability after TDS exceeds ₹10,000 in a financial year are generally required to pay advance tax.

Q2: What are the due dates for advance tax installments?
A: For individuals: 15% by June 15, 45% by September 15, 75% by December 15, and 100% by March 15.

Q3: What happens if I miss an advance tax installment?
A: You may be liable to pay interest under Section 234B and 234C of the Income Tax Act.

Q4: Can I revise my advance tax payments during the year?
A: Yes, you can revise your estimates and subsequent installments if your income projections change significantly.

Q5: Are senior citizens required to pay advance tax?
A: Senior citizens (age 60+) without business income are exempt from paying advance tax.