{"id":5534,"date":"2026-02-26T20:00:00","date_gmt":"2026-02-26T14:30:00","guid":{"rendered":"https:\/\/tradebrains.in\/money\/?p=5534"},"modified":"2026-02-26T17:28:58","modified_gmt":"2026-02-26T11:58:58","slug":"what-is-advance-tax-how-missing-it-can-cost-you-thousands-in-penalties","status":"publish","type":"post","link":"https:\/\/tradebrains.in\/money\/what-is-advance-tax-how-missing-it-can-cost-you-thousands-in-penalties\/","title":{"rendered":"What is Advance Tax? How Missing It Can Cost You Thousands in Penalties"},"content":{"rendered":"\n
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Synopsis<\/strong>: In this article, we will be looking into what advance tax is and how the penalty traps affect individuals without their knowledge.\u00a0Advance tax is paying your income tax in advance, before the financial year ends rather than all at once during filing.<\/em><\/p>\n<\/blockquote>\n\n\n\n

Almost similar like EMIs but for taxes where instead of lump-sum payment in March or July, you spread your tax liability across the year in four scheduled instalments. The due dates for advance tax payment in India are: <\/p>

\"scapia<\/a><\/div>\n\n\n\n
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  • 15th<\/sup> June \u2013 15% of the tax liability <\/li>\n\n\n\n
  • 15th<\/sup> September \u2013 45% of the tax liability <\/li>\n\n\n\n
  • 15th<\/sup> December \u2013 75% of the tax liability <\/li>\n\n\n\n
  • 15th<\/sup> March \u2013 100% of the tax liability <\/li>\n<\/ul>\n\n\n\n

    Who needs to pay advance tax? <\/strong><\/h2>\n\n\n\n

    Any person whose total tax liability for the year exceeds INR 10000 after accounting for TDS is required to pay advance tax. This applies to: <\/p>\n\n\n\n

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    • Freelancers and consultants whose clients don\u2019t deduct TDS or deduct only partially <\/li>\n\n\n\n
    • Business owners and self-employed professionals <\/li>\n\n\n\n
    • Salaried individuals who have additional income from rent, capital gains, interest or investments. <\/li>\n\n\n\n
    • Investors who earn returns from stocks, mutual funds or crypto. <\/li>\n\n\n\n
    • The only people exempt are the senior citizens aged 60 and above who do not have any income from business or profession.<\/li>\n<\/ul>\n\n\n\n

      Real-life example<\/strong><\/h2>\n\n\n\n

      Priya is a UX designer working as a freelancer. Her annual income is INR 12 lakhs. Her clients pay her directly, with no TDS deduction. Her estimated tax liability for the year comes to approx. INR 1.5 lakhs. Since it exceeds INR 10000, priya must pay advance tax in four instalments: <\/p>