The first instalment of advance tax for the Financial Year 2026-27 is due today, Monday, with taxpayers required to deposit at least 15% of their estimated annual liability before midnight or risk interest penalties under the Income-tax Act, 2025.
Advance tax is a system where the tax is paid in instalments through the financial year rather than as a lump sum at the time of filing returns. It applies in every case where estimated tax liability — after accounting for tax deducted at source (TDS) and tax collected at source (TCS) — exceeds Rs 10,000.
Freelancers, consultants, traders, investors, landlords, FD interest earners, and business owners are all in scope, not just salaried individuals.
Who Is Exempt From Advance Tax?
Resident senior citizens aged 60 and above are exempt, unless they earn income from a business or profession. In that case, they remain liable if their tax liability crosses Rs 10,000. Non-resident Indians are also liable for advance tax on income earned in India.
Taxpayers who declare profits under the presumptive taxation scheme are required to pay their entire advance tax liability in a single instalment on or before March 15, and the quarterly due dates do not apply to them.
Advance Tax Schedule for FY 2026-27
Today’s instalment is the first of four. The complete advance tax calendar for FY2026-27 is: 15% of tax liability by June 15; 45% by September 15; 75% by December 15; and 100% by March 15.
Any tax paid up to March 31 is treated as advance tax.
What Happens If You Miss Today’s Deadline?
Failure to pay, underpayment, or delayed payment attracts interest at 1% per month under Sections 424 and 425 of the Income-tax Act, 2025 — the equivalents of Sections 234B and 234C under the old Act. Persistent non-payment or false estimation of advance tax may also invite a notice from the Income Tax Department.
How to calculate what you owe
Taxpayers must estimate all income for the year across all sources — salary, business income, rental income, capital gains, interest income — and arrive at total taxable income after deducting applicable deductions. Tax is then computed at applicable slab rates, surcharge, and cess applied, and TDS already deducted. The resulting net tax liability is what advance tax is calculated on. If the figure exceeds Rs 10,000, the advance tax obligation applies.
If income projections change during the year, taxpayers can revise the amount in remaining instalments.
How to pay before the day ends
Corporate taxpayers and non-corporate taxpayers subject to tax audit under Section 44AB are required to pay electronically. Other taxpayers may pay either online or by depositing the Challan Reference Number (CRN) at designated banks. No manual challans are accepted at bank counters.
To pay online, taxpayers must go to incometax.gov.in, select ‘e-Pay Tax’ under Quick Links, complete PAN and OTP verification, select assessment year and payment type as ‘Advance Tax (200)’, fill in the tax breakup details, and complete payment via net banking, debit card, or payment gateway. A Challan Form (CRN) is generated on successful payment and must be downloaded for records.
