Advance Tax FY 2026-27: Due Dates, Calculation, Online Payment Process & Interest
- CA Pratik Bharda
- Jun 5
- 14 min read
Updated: Jun 19
Advance tax is income tax paid during the financial year based on estimated income. Instead of paying the full tax amount at the time of ITR filing, eligible taxpayers pay it in installments during the year.
For FY 2026-27, advance tax applies when the estimated tax payable after reducing TDS and TCS is ₹10,000 or more. Regular taxpayers generally pay advance tax in four installments. However, eligible taxpayers covered under the presumptive taxation provisions follow a different payment rule.
If advance tax is not paid on time or is paid less than the required amount, interest may apply under Sections 424 and 425 of the Income-tax Act, 2025.
Table of Content
Meaning of Advance Tax
Advance tax means paying income tax during the financial year instead of waiting until the time of ITR filing. It follows the “pay as you earn” concept, where taxpayers estimate their income for FY 2026-27 and pay tax in scheduled installments.
For FY 2026-27, advance tax provisions are covered under the Income-tax Act, 2025. This system helps taxpayers divide their tax payment across the year and avoid a large tax burden at the end of the financial year.
Advance tax does not apply to every taxpayer. It becomes applicable only when the estimated tax payable for the financial year is ₹10,000 or more after considering TDS and TCS.
How Advance Tax Helps Avoid Year-End Tax Burden
Advance tax helps taxpayers manage their income tax liability during the financial year instead of facing a large tax payment at the time of ITR filing. Since the tax is paid in installments, it becomes easier to plan cash flow and avoid last-minute financial pressure.
This is especially useful for taxpayers who earn income from sources where full TDS may not be deducted, such as capital gains, rent, interest income, freelance income, professional fees, or business income. By estimating income in advance and paying tax on time, taxpayers can reduce the risk of interest under the Income-tax Act.
For FY 2026-27, if the estimated tax payable after TDS/TCS is ₹10,000 or more, advance tax should be paid as per the prescribed due dates.Timely payment also helps taxpayers keep their tax records cleaner and reduces surprises while filing the income tax return.
Who is Required to Pay Advance Tax for FY 2026-27?
Advance tax is payable by any taxpayer whose estimated tax payable for the financial year is ₹10,000 or more after reducing TDS and TCS. This rule applies to salaried individuals, freelancers, professionals, business owners, HUFs, NRIs, and other taxpayers who have taxable income during the year.
However, resident senior citizens aged 60 years or above are not required to pay advance tax if they do not have income from business or profession.
Even if TDS or TCS has already been deducted, advance tax may still apply when additional income increases the final tax liability. For example, if a salaried person earns capital gains, rental income, interest income, dividend income, or freelance income during FY 2026-27, and the remaining tax payable after TDS/TCS is ₹10,000 or more, advance tax must be paid.
For example, if your total tax liability is ₹75,000 and TDS already deducted is ₹60,000, the balance tax payable is ₹15,000. Since this amount is more than ₹10,000, advance tax provisions will apply.
Advance Tax Installment Schedule for Regular Taxpayers in FY 2026-27
Regular taxpayers who are liable to pay advance tax must pay it in four installments during the financial year. The amount payable is based on the estimated advance tax liability for FY 2026-27.
Installment | Due Date | Minimum Advance Tax Payable |
1st Installment | On or before 15 June 2026 | At least 15% of advance tax |
2nd Installment | On or before 15 September 2026 | At least 45% of advance tax, after reducing earlier payment |
3rd Installment | On or before 15 December 2026 | At least 75% of advance tax, after reducing earlier payments |
4th Installment | On or before 15 March 2027 | 100% of advance tax, after reducing earlier payments |
Note: Interest under Section 425 is not charged for the June installment if at least 12% of the tax due on returned income is paid by 15 June. Similarly, interest is not charged for the September installment if at least 36% is paid by 15 September.
Advance Tax Rules for Taxpayers Choosing the Presumptive Taxation Scheme
Taxpayers who declare income under the presumptive taxation provisions covered by Section 58 of the Income-tax Act, 2025 follow a simpler advance tax payment rule.
Eligible presumptive taxation taxpayers covered under Section 58(2), Table Sl. No. 1 or 3 are not required to pay advance tax in four installments. They must pay the full advance tax amount in one installment.
Due Date | Advance Tax to be Paid |
On or before 15 March 2027 | 100% of advance tax liability |
Any amount paid as advance tax on or before 31 March 2027 will still be treated as advance tax paid during that financial year. However, payment after 15 March 2027 may attract interest as applicable.
Taxpayers covered under presumptive taxation should check the applicable category carefully before deciding the payment schedule.
Step-by-Step Method to Calculate Advance Tax Liability for FY 2026-27
To calculate advance tax, you need to estimate your income for the financial year and work out the tax payable after adjusting TDS and TCS. This helps you know whether advance tax applies and how much needs to be paid in each installment.
Follow these steps to calculate advance tax:
Estimate your total income for FY 2026-27 from all sources, such as salary, business income, professional income, capital gains, rental income, interest income, or any other taxable income.
Review your income from earlier financial years to make a practical estimate for the current year.
Reduce eligible deductions, exemptions, and allowable expenses, wherever applicable.
Calculate your net taxable income after considering all eligible deductions.
Apply the applicable income tax slab rates based on the tax regime chosen by you.
Add surcharge, if applicable, and health and education cess.
Reduce TDS, TCS, and any tax already paid during the financial year.
If the remaining tax payable is ₹10,000 or more, you must pay advance tax as per the prescribed due dates.
Particulars | Amount |
Gross Total Income | XXX |
Less: Eligible deductions under Chapter (VI-A) | XXX |
Net Total Income | XXX |
Tax payable on total income | XXX |
Add: Surcharge, if applicable | XXX |
Add: Health and Education Cess | XXX |
Gross Tax Liability | XXX |
Less: TDS/TCS already deducted or collected | XXX |
Net Tax Liability | XXX |
Advance Tax Payable = Tax on Estimated Total Income – TDS/TCS already deducted or collected
If the net tax liability is ₹10,000 or more, advance tax payment becomes applicable for FY 2026-27.
How to Pay Advance Tax Online for FY 2026-27 Through the Income Tax Portal
Taxpayers can pay advance tax online through the official Income Tax e-filing portal. The payment can be made either after logging in to the portal or directly through the e-pay tax option without login. Make sure you select the correct tax year, payment type, and challan details before completing the payment.
Option 1: Pay Advance Tax After Logging in to the Income Tax Portal
Visit the Income Tax e-filing portal and log in using your PAN or user ID and password.
Go to the e-File section and select e-Pay Tax.
Click on New Payment to start a fresh tax payment.
Select Income Tax as the payment category and proceed.
Choose the relevant tax year as 2026-27 and select Advance Tax under the applicable minor head.
Enter the tax amount under the correct components, such as basic tax, surcharge, cess, or interest, if applicable.
Select your preferred payment method and click on Pay Now.
Review the details, accept the terms, and complete the payment through the selected mode.
Option 2: Pay Advance Tax Without Logging in to the Income Tax Portal
Visit the Income Tax e-filing portal.
Go to Quick Links and click on e-Pay Tax. You can also search for the e-Pay Tax option on the portal.
Enter your PAN, confirm it again, add your mobile number, and continue.
Verify the OTP received on your mobile number.
Select Income Tax as the type of payment.
Choose the tax year as 2026-27 and select Advance Tax (100) as the payment type.
Enter the advance tax amount and other required tax details.
Select your payment mode and bank, then continue.
Preview the challan carefully. If any detail is incorrect, edit it before making the payment.
Click on Pay Now and complete the transaction.
After payment, download and save the challan receipt. The challan usually contains details such as the BSR code, challan serial number, payment date, and tax amount. These details may be required while filing your income tax return.
When Salaried Individuals May Need to Pay Advance Tax in FY 2026-27
For most salaried individuals, advance tax usually does not become a concern because employers deduct TDS from salary every month based on the applicable tax slab. However, advance tax may still apply if the total tax payable after TDS crosses ₹10,000 during the financial year.
This can happen in the following situations:
1. Change of Job During the Financial Year
When an employee switches jobs, the new employer may not have complete details of salary earned from the previous employer. If the earlier salary details are not reported correctly, deductions such as the basic exemption limit or standard deduction may be considered twice.
This can lead to lower TDS deduction during the year. Later, while filing the ITR, the employee may find that additional tax is payable.If the tax payable after TDS is ₹10,000 or more, advance tax provisions may apply, and interest may also be charged under Sections 424 and 425 of the Income-tax Act, 2025.
2. Additional or Irregular Income During the Year
Salaried taxpayers may also become liable to pay advance tax if they earn income other than salary. This may include:
Interest income
Rental income
Freelance or consulting income
Taxable gifts
Dividend income
Capital gains
If such income increases the overall tax liability beyond the amount covered by TDS, and the balance tax payable is ₹10,000 or more, the taxpayer must pay advance tax.
Advance Tax on Capital Gains for FY 2026-27
Capital gains are often not known at the beginning of the financial year because they usually arise when an asset is sold. For example, capital gains may arise from the sale of shares, mutual funds, property, gold, or other capital assets.
In such cases, the taxpayer should estimate the tax payable once the capital gain is earned. If the additional tax liability after TDS/TCS is ₹10,000 or more, advance tax should be paid in the remaining installments of the financial year.
For example, if a taxpayer sells mutual fund units in July 2026 and earns long-term capital gains resulting in a tax liability of ₹50,000, there is no advance tax liability for the April-June quarter because the capital gain did not exist then. The taxpayer should pay the applicable advance tax in the remaining due dates after the gain arises.
Interest Impact of Missing or Short Advance Tax Payments for FY 2026-27
If advance tax is not paid on time, or if the amount paid is lower than the required installment, interest may be charged under the Income-tax Act, 2025. The interest generally applies when the taxpayer does not pay enough tax during the financial year through advance tax, TDS, or TCS.
1. Interest for Non-Payment or Short Payment of Advance Tax in FY 2026-27
If advance tax is not paid on time, or if the amount paid is less than the required installment amount, interest may apply under the Income-tax Act, 2025. The two key sections are Section 424 and Section 425.
2. Interest Under Section 424 for Default in Advance Tax Payment
Section 424 applies when a taxpayer who is liable to pay advance tax does not pay advance tax, or pays less than 90% of the assessed tax through advance tax, TDS, or TCS.
In such cases, simple interest at 1% per month or part of a month may apply on the unpaid amount or shortfall, as applicable.
3. Interest Under Section 425 for Deferment or Short Payment of Installments
Section 425 applies when advance tax installments are delayed or paid short. Interest is calculated on the shortfall from the required amount for each due date.
Due Date | Required Advance Tax | Interest on Shortfall |
15 June | 15% of tax due on returned income | 3% |
15 September | 45% of tax due on returned income | 3% |
15 December | 75% of tax due on returned income | 3% |
15 March | 100% of tax due on returned income | 1% |
For eligible presumptive taxation taxpayers, if the full advance tax is not paid by 15 March, simple interest at 1% may apply on the shortfall.
No interest is charged for certain incomes such as capital gains, dividend income, or income from a new business or profession if the taxpayer pays the tax on such income in the remaining advance tax installments or by 31 March of the tax year.
Advance Tax Section Mapping Under Income-tax Act, 2025
For FY 2026-27, advance tax provisions are covered under the Income-tax Act, 2025. The table below gives a section-wise view for easier understanding.
Topic | Income-tax Act, 2025 |
Liability to pay advance tax | Section 403 |
Condition for payment of advance tax | Section 404 |
Computation of advance tax | Section 405 |
Payment of advance tax based on taxpayer’s estimate | Section 406 |
Order by Assessing Officer for advance tax payment | Section 407 |
Advance tax installments and due dates | Section 408 |
When taxpayer is treated as assessee in default | Section 409 |
Interest for default in payment of advance tax | Section 424 |
Interest for deferment or shortfall in advance tax installments | Section 425 |
Presumptive taxation provisions | Section 58 |
Example of Advance Tax Calculation for FY 2026-27
Let us understand advance tax with a simple example.
Assume Rohan has the following estimated income for FY 2026-27 and chooses the new tax regime:
Salary income: ₹18,00,000
Interest income from fixed deposits: ₹80,000
TDS deducted by employer: ₹1,10,000
Step 1: Calculate Total Taxable Income
Particulars | Amount |
Salary income | ₹18,00,000 |
Less: Standard deduction | ₹75,000 |
Income from salary | ₹17,25,000 |
Interest income | ₹80,000 |
Total taxable income | ₹18,05,000 |
Step 2: Calculate Net Tax Liability
Particulars | Amount |
Income tax payable | ₹1,61,000 |
Add: Health and education cess at 4% | ₹6,440 |
Gross tax liability | ₹1,67,440 |
Less: TDS credit | ₹1,10,000 |
Net tax liability | ₹57,440 |
Since Rohan’s tax payable after TDS is ₹10,000 or more, he needs to pay advance tax during FY 2026-27.
Step 3: Advance Tax Installment Break-up
Due Date | Cumulative Advance Tax Requirement | Installment Amount Payable |
15 June 2026 | 15% | ₹8,616 |
15 September 2026 | 45% | ₹17,232 |
15 December 2026 | 75% | ₹17,232 |
15 March 2027 | 100% | ₹14,360 |
Total | 100% | ₹57,440 |
This example shows how advance tax is calculated after estimating total income, applying the applicable tax slab, adding cess, and reducing TDS. If the remaining tax payable is ₹10,000 or more, the taxpayer should pay advance tax as per the prescribed installment schedule to avoid interest.
How to Correct an Advance Tax Challan Online
If there is an error in your advance tax challan, you can request a correction online through the Income Tax e-filing portal. This feature helps taxpayers correct details such as the assessment year, major head, or minor head in the challan.
Follow these steps to submit a challan correction request online:
Log in to the Income Tax e-filing portal using your credentials.
Go to the Services tab and select Challan Correction.
Click on Create Challan Correction Request.
Choose the type of correction required. You can usually request correction for:
Assessment year
Major head
Minor head
Enter the required details, such as the assessment year or Challan Identification Number.
Based on the details entered, the portal will show the relevant challan or a list of challans for the selected assessment year.
Select the challan that needs correction and enter the correct information.
Verify the request through Aadhaar OTP, Digital Signature Certificate, or Electronic Verification Code through the available verification options.
After successful verification, the portal will display a confirmation message with a transaction ID. Save this ID to track the challan correction request later.
Advance Tax Applicability for HUFs and NRIs in FY 2026-27
Advance tax rules also apply to HUFs and NRIs if their net tax payable for the financial year is ₹10,000 or more after reducing TDS and TCS.
For HUFs, advance tax may apply on income from business or profession, house property, capital gains, interest, rent, or other taxable sources. The same advance tax due dates and interest provisions generally apply to HUFs as they apply to individual taxpayers.
NRIs are also required to pay advance tax if they earn income taxable in India. This may include rental income from property in India, capital gains from sale of Indian assets, business income, or interest income.If the tax payable after TDS/TCS is ₹10,000 or more, advance tax must be paid within the applicable due dates.
Conclusion: Why Timely Advance Tax Payment Matters
Advance tax helps taxpayers spread their income tax payment across the financial year instead of paying the full amount at the time of ITR filing. To stay compliant, taxpayers should estimate their yearly income, calculate the tax payable, reduce TDS/TCS, and pay advance tax by the prescribed due dates.
For FY 2026-27, regular taxpayers must follow the installment schedule under Section 408 of the Income-tax Act, 2025. Eligible presumptive taxation taxpayers covered under Section 58 must pay their full advance tax by 15 March 2027.
Missing advance tax payments or paying less than the required amount can lead to interest under Sections 424 and 425 of the Income-tax Act, 2025. However, if excess advance tax is paid, the taxpayer can claim it as a refund while filing the income tax return.
TaxBuddy can help taxpayers understand their estimated tax liability, review TDS/TCS, calculate advance tax, and file their income tax return correctly.
Frequently Asked Questions on Advance Tax
1. What is advance tax?
Advance tax is income tax paid during the financial year instead of paying the full tax amount at the time of ITR filing. It is based on estimated income and is paid in installments.
2. Who has to pay advance tax for FY 2026-27?
Any taxpayer whose estimated tax payable after reducing TDS and TCS is ₹10,000 or more must pay advance tax. This can include salaried individuals, freelancers, professionals, businesses, HUFs, and NRIs.
3. Are salaried employees required to pay advance tax?
Salaried employees usually do not need to pay advance tax if enough TDS is deducted by the employer. However, advance tax may apply if they earn extra income from capital gains, rent, interest, freelance work, or other taxable sources.
4. What are the advance tax due dates for FY 2026-27?
For regular taxpayers, advance tax must be paid in four installments: 15 June 2026, 15 September 2026, 15 December 2026, and 15 March 2027.
5. How much advance tax should be paid in each installment?
Regular taxpayers should pay at least 15% of the total tax liability by 15 June, 45% by 15 September, 75% by 15 December, and 100% by 15 March.
6. What is the advance tax rule for presumptive taxation taxpayers?
Taxpayers covered under eligible presumptive taxation provisions of Section 58 of the Income-tax Act, 2025 have to pay 100% of their advance tax liability on or before 15 March of the financial year. Any amount paid up to 31 March may still be treated as advance tax paid during that financial year, but payment after 15 March may attract interest.
7. Can advance tax be paid after the due date?
Yes, advance tax can still be paid after the due date. However, delay or short payment may attract interest under the applicable provisions of the Income-tax Act.
8. What happens if I do not pay advance tax on time?
If advance tax is not paid or is paid less than the required amount, interest may be charged under Sections 424 and 425 of the Income-tax Act, 2025.
9. How do I calculate advance tax?
To calculate advance tax, estimate your total income for the year, reduce eligible deductions, calculate tax as per the chosen regime, add cess and surcharge if applicable, and then reduce TDS/TCS already deducted.If the balance tax payable is ₹10,000 or more, advance tax must be paid.
10. Can I consider deductions while estimating advance tax?
Yes, eligible deductions and exemptions can be considered while estimating taxable income for advance tax calculation, if they are applicable under the tax regime chosen by the taxpayer.
11. What if my income cannot be estimated at the beginning of the year?
Income such as capital gains, lottery winnings, or other unexpected income may not be known in advance. In such cases, tax should be calculated when the income arises and advance tax should be paid in the remaining installments.
12. What if I pay more advance tax than required?
If excess advance tax is paid, it can be claimed as a refund while filing the income tax return. The refund will be processed after the return is filed and verified.
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