The advance tax deadline of 15 December requires taxpayers to pay 75% of their total advance tax for FY 2025–26. Anyone with tax liability over ₹10,000 (after TDS) must pay advance tax—salaried, freelancers, business owners, and traders. Missing the deadline leads to interest penalties under Sections 234B and 234C.
What Is Advance Tax? (Simple Explanation)
Advance tax is “pay-as-you-earn” income tax.
Instead of paying tax only at the end of the year, you pay it in four instalments.
It applies to all individuals whose estimated tax liability is more than ₹10,000 after TDS.
Advance Tax Due Dates (FY 2025–26)
| Due Date | Percentage of Tax Payable | Remarks |
|---|---|---|
| 15 June | 15% | 1st instalment |
| 15 September | 45% | 2nd instalment cumulative |
| 15 December | 75% | Major instalment |
| 15 March | 100% | Final instalment |
Who Must Pay Advance Tax?
✔ Required for:
Salaried employees with extra income:
Rent, interest, capital gains, freelancing
Freelancers
Small business owners
Shop owners
Consultants
Traders (stock, intraday, F&O, crypto)
Professionals: doctors, lawyers, designers, CA, etc.
❌ Not required for:
Senior citizens (60+) with no business income
Individuals whose tax liability after TDS is less than ₹10,000
How to Calculate Advance Tax (Step-by-Step)
Step 1: Estimate total income
Include:
Salary
Rent
Interest
Freelance income
Trading profit
Capital gains
Business income
Step 2: Subtract deductions (80C, 80D, HRA, etc.)
Step 3: Calculate total tax payable
Step 4: Subtract TDS already deducted
Step 5: If tax > ₹10,000 → You must pay advance tax
Step 6: Pay 75% of that amount by 15 December
Example: Advance Tax Calculation
Suppose:
Total estimated income = ₹12,00,000
Tax payable = ₹1,48,200
TDS deducted = ₹75,000
Tax left to pay = ₹73,200
By 15 December, you must have paid:
75% of ₹73,200 = ₹54,900
If you paid less earlier, pay the difference now.
Penalties for Missing 15 December Deadline
Missing advance tax instalments leads to:
Section 234C – Interest for Late Payment of Instalments
Interest = 1% per month on shortfall.
Section 234B – Interest for Not Paying 90% Total Tax by March
If you don’t pay 90%+ of final tax by 15 March → 1% monthly interest until paid.
How to Pay Advance Tax Online (Step-by-Step Guide)
Visit: https://eportal.incometax.gov.in
Login → “e-Pay Tax”
Select “Pay Tax”
Choose Challan 280 (Income Tax – Regular Assessment)
Select Advance Tax
Enter amount
Pay via UPI / Net banking / Debit card
Download challan receipt
Keep this for ITR filing.
What Happens If You Overpay?
Overpaid amount is:
Adjusted during ITR filing
Refunded by Income Tax Department (with interest in some cases)
Special Cases: Advance Tax Rules
1. Capital Gains & Advance Tax
Gains from:
Stocks
Mutual funds
Property
Crypto
Pay advance tax in the same quarter when gain occurs.
2. Intraday & F&O Traders
Trading income is business income → Advance tax mandatory.
3. Salaried Employees with Side Income
Even salaried people must pay if:
Rent income
Freelancing
Consulting
Trading income
push tax liability above ₹10,000.
Internal & External Linking Suggestions
Internal Links:
Credit utilization impact on loan approval
Best money habits for 2026
How to file income tax return correctly
External Links:
Income Tax Portal
CBDT Advance Tax Guidelines
Section 234B & 234C documentation
Key Takeaways
Advance tax is mandatory if tax liability > ₹10,000.
15 December is the most important instalment → 75% of tax must be paid.
Missing deadlines results in 1% monthly penalty.
Salaried people with extra income must also pay advance tax.
Paying on time helps avoid large penalties during ITR season.
FAQs
1. Who needs to pay advance tax by 15 December?
Anyone with tax liability > ₹10,000 after TDS.
2. How much do I need to pay on 15 December?
75% of total advance tax.
3. Is advance tax only for business owners?
No—salaried with extra income must also pay.
4. What if I miss the deadline?
Interest under Sections 234B & 234C.
5. Can I pay advance tax through UPI?
Yes.
6. Does capital gains require advance tax?
Yes—pay in the same quarter.
7. Are senior citizens exempt?
Yes, if they have no business income.
8. Is advance tax compulsory for freelancers?
Yes.
9. Does TDS reduce advance tax?
Yes—subtract TDS first.
10. Can I revise advance tax calculations?
Yes—pay the difference in the next instalment.
11. What if I overpay?
You get a refund.
12. Is interest charged daily?
Monthly at 1%.
13. Should traders pay advance tax?
Yes—F&O and intraday earnings are taxable quarterly.
14. Can I pay advance tax on mobile?
Yes via the Income Tax portal.
15. What documents are needed?
None—just PAN and login.
Conclusion
The 15 December advance tax deadline is crucial for avoiding penalties and keeping your tax obligations on track. If your tax liability after TDS is above ₹10,000, paying advance tax is not optional—it’s mandatory.
If you need funds for tax payments, emergencies, or smart planning,
Vizzve Financial offers quick personal loans, easy approval, and low documentation.
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Published on : 2nd December
Published by : SMITA
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