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Income-tax Act 202519 September 20267 min read

Advance Tax Under the Income-tax Act, 2025: The Four Dates, the Safe Harbours, and What a Missed December Costs

The money works as it always did. The section numbers don't, and 15 December is the date that costs the most to miss.

In short
  • Advance tax under the Income-tax Act, 2025 is due in four instalments: 15% by 15 June, 45% by 15 September, 75% by 15 December and 100% by 15 March, where the year's tax is ₹10,000 or more.
  • Section 425 charges 3% on the shortfall at each of the first three dates and 1% at 15 March, with no interest if 12% was paid by June or 36% by September.
  • Section 424 adds 1% a month from 1 April where less than 90% was paid; those declaring income under section 58(2), serial 1 or 3, pay the whole amount by 15 March.
Rolled Indian rupee notes standing behind three stacks of rupee coinsPhotograph: rupixen / Unsplash

The 15 September instalment has just gone. For most people who pay advance tax, it went the way it always does: a quick estimate, a challan, a relieved exhale, and the matter put away until December.

This year the challan says something different. From tax year 2026-27, advance tax is paid under the Income-tax Act, 2025, and sections 207 to 211, 234B and 234C have become sections 403 to 408, 424 and 425. The money works almost exactly as before. But the new text is laid out more plainly than the old, and it is a good moment to understand what each date actually costs, because the next one, 15 December, is the one people most often miss.

Who pays

Section 404 makes advance tax payable where the tax for the year comes to ₹10,000 or more. Section 405 works that out after tax deducted or collected at source, so a salaried person whose TDS covers their tax usually owes nothing.

Section 403(3) excuses one group entirely: a resident individual who is sixty or older at any time in the year and has no income from business or profession. A retired person living on pension, interest and rent pays their tax with the return, not in advance.

Four dates, and one for section 58

15%15 Junesafe at 12%45%15 Septembersafe at 36%75%15 December100%15 March3% on the shortfall at each of the first three steps, 1% at the last
The four steps of section 408. The dashed lines are the safe harbours in section 425(2): 12% by June and 36% by September keep interest away for those two dates.

Section 408(1) sets the steps:

  • 15 June: at least 15% of the year's advance tax;
  • 15 September: at least 45%;
  • 15 December: at least 75%;
  • 15 March: the whole of it.

Section 408(2) gives a single date to anyone declaring income under section 58(2), Table serial 1 or 3, the presumptive scheme that was 44AD and 44ADA: the whole amount by 15 March, with nothing due before. Goods carriage owners under serial 2 (was 44AE) are not covered and pay the four instalments. And section 408(3) treats anything paid by 31 March as advance tax for that year.

What a shortfall costs

Two sections charge interest, and they measure different things.

Section 425, for paying late within the year. At each of the first three dates, the shortfall against 15%, 45% and 75% attracts interest of 3%. At 15 March, the shortfall against the full amount attracts 1%. Section 425(2) adds two safe harbours: no interest for June if 12% was paid by then, and none for September if 36% was.

Section 424, for not paying enough by the end of the year. If less than 90% of the assessed tax was paid as advance tax, interest runs at 1% a month on the shortfall from 1 April until the tax is paid or assessed.

Two examples make the difference clear. Take tax of ₹4,00,000 for the year, after TDS.

  • Someone who pays on time until September, then misses December. By 15 December, 75% is ₹3,00,000. They have paid 45%, ₹1,80,000. The shortfall of ₹1,20,000 at 3% is ₹3,600. If they pay the rest by 15 March, nothing more is charged under section 425.
  • Someone who pays nothing until March. June: 3% on ₹60,000, ₹1,800. September: 3% on ₹1,80,000, ₹5,400. December: 3% on ₹3,00,000, ₹9,000. March, if they pay it all by then: nothing, since the whole amount is in. That is ₹16,200. If they pay nothing by 15 March either, another 1% on ₹4,00,000, ₹4,000, brings it to ₹20,200, and section 424 then starts running from 1 April.
December is the costly one to miss. It is the last 3% date, and by then the shortfall is at its largest.

When a shortfall carries no interest

Section 425(4) excuses shortfalls caused by income that could not have been estimated at the earlier dates: capital gains, dividends, certain winnings, and business income arising for the first time. The condition is that the tax on that income is paid in full in the remaining instalments, or by 31 March.

Work out your own

Try it

What each instalment should be, and what a shortfall costs

Enter the year’s tax after TDS and TCS, and what was paid in each instalment. Two instalments are filled in as an example.

  • 15 June15% due by now: ₹60,000. Paid by now: ₹60,000.No interest
  • 15 September45% due by now: ₹1,80,000. Paid by now: ₹2,10,000.No interest
  • 15 December75% due by now: ₹3,00,000. Paid by now: ₹2,10,000.Interest ₹2,700
  • 15 March100% due by now: ₹4,00,000. Paid by now: ₹2,10,000.Interest ₹1,900

Interest under section 425: ₹4,600

3% of the shortfall at each of the first three dates and 1% at 15 March. No interest for June if 12% was paid by then, or for September if 36% was.

If less than 90% of the tax is paid by 31 March, section 424 adds 1% a month on the shortfall from 1 April until the tax is paid or assessed. Figures are before any rounding the Rules require.

Income-tax Act, 2025, sections 404, 408, 424 and 425. Nothing you type leaves this page.

Before 15 December

  • Re-estimate the year's income now, with half the year's books in hand, rather than repeating September's figure.
  • Take off the TDS and TCS that will actually be deducted, as section 405 allows, and not what you hope will be.
  • If a large capital gain landed after September, pay its tax in the December or March instalment to keep it within section 425(4).
  • If the income is under section 58(2), serial 1 or 3 (was 44AD or 44ADA), plan the whole amount for 15 March, and don't let it slip into April.

Where this comes from

The rules are quoted from the Income-tax Act, 2025 as amended by the Finance Act, 2026: sections 403 to 408, 424 and 425. The examples are arithmetic on section 425, shown before any rounding the Rules require. They apply from tax year 2026-27. Advance tax for 2025-26 and earlier years was governed by the 1961 Act.

Questions this answers

What are the advance tax due dates for FY 2026-27?

15 June (15%), 15 September (45%), 15 December (75%) and 15 March (100%), under section 408 of the Income-tax Act, 2025.

Which section of the new Income-tax Act replaces 234C?

Section 425. It charges 3% on the shortfall at each of the first three instalment dates and 1% at 15 March.

Which section replaces 234B?

Section 424. Where less than 90% of the assessed tax was paid as advance tax, it charges 1% a month on the shortfall from 1 April.

Do senior citizens have to pay advance tax?

Not if they are resident, sixty or older at any time in the year, and have no income from business or profession, under section 403(3).

When do people under section 58 (44AD) pay advance tax?

Those declaring income under section 58(2), Table serial 1 or 3 (was 44AD or 44ADA), pay the whole amount on or before 15 March, under section 408(2). Goods carriage owners under serial 2 (was 44AE) follow the four instalments.

Look up any section

The Income-tax Act 2025 section finder lists every 1961 TDS and TCS section with its 2025 section and Table serial, the rate and threshold as enacted, and the page of the Act, with a TDS rate chart and a TCS rate chart.