Exemptions and Refunds of Advance Tax

Exemptions and Refunds of Advance Tax
Advance tax means income tax should be paid in advance instead of paying at year end.These payments have to be made in installments as per due dates provided by the income tax department.

Exemption for payment of Advance-tax is applicable to the following:
  • Senior Citizen who do not have Income from Business.
  • Presumptive Business Income under section 44AD.
  • Others having Tax Liability less than Rs 10,000/- after considering TDS and Tax Relief on Income.

How do I pay my Advance tax through online mode?

Paid Through Online mode: If a taxpayer wishes to pay taxes online then he is required to follow below steps:

Visit website

Select Challan 280

There are various types of challans like ITNS 280, ITNS 281, ITNS 282, ITNS 283, ITNS 284 or Form 26QB demand payment as applicable. In case of payment of Advance tax, ITNS 280 will be applicable.

Enter PAN details

Individual taxpayers are required to click on (0021- Income-tax – other than companies). Then enter PAN and other mandatory details like full name, address, contact No. etc.

Select type of Payment

There are various types of payments viz. advance tax, self-assessment tax, tax on regular assessment, taxpayer is required to select type of payment as advance tax.

Data Confirmation

On confirmation of the data so entered, the taxpayer will be directed to the net-banking site of the bank.

Pay through net banking

The taxpayer has to login to the net-banking site with the user id / password provided by the bank for net-banking purpose and enter payment details at the bank site.

Successful payment

A challan counterfoil will be generated containing challan number, amount paid, name of a bank branch through which e-payment has been made.Counterfoil is proof of payment being made.

What if advance tax paid is more than required?

If the amount paid as advance tax is higher than the total tax liability, the assessee will receive the excess amount as a refund. Interest @ 6% per annum will be paid by the Income Tax department to the assessee on the excess amount if the amount is more than 10% of tax liability.

Not filing a return on time does have financial implications, especially if you have a net income tax payable and/or if you have losses to be carried forward. This can really hurt especially if the losses to be carried forward are significant. Therefore, your best option is to ensure that you file the income tax return by the deadline.”Better late than never” is the best policy when it comes to income tax return filing.

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