Under Advance Tax, the government collects income tax in installments. If the taxpayer does not deposit the advance tax on time, then he has to pay interest in the form of penalty.
New Delhi. If there is an advance tax liability on your annual income and you have not yet paid its second installment (2nd Installment), then now only a few hours are left for it. Actually, today i.e. 15th September 2021 is the last date for depositing the second installment of advance tax. The Central Government collects Income Tax in installments under Advance Tax. If a taxpayer deposits its installments on time, then he gets its benefit. At the same time, heavy interest has to be paid for not paying the installment.
On whom the liability of advance tax is made, the liability of advance tax is also made on the Salaried Employees, Professionals, Businessmen, Freelancers. When the total tax liability after TDS or TCS (TDS / TCS) or after earning from abroad exceeds 10 thousand rupees, then there is a provision for the liability of advance tax. If a businessman pays less tax than the entire income, then interest will also be charged on it.
What are the benefits of depositing advance tax, if the taxpayer deposits the installment of advance tax every quarter on the stipulated time, then he does not have a heavy tax burden at the end of the financial year. Often, depositing tax at the time of filing ITR or at the end of the financial year either leads to a loss of a large part of your income or you have to arrange money by depositing it separately. At the same time, paying the tax on time does not carry the burden of interest. If you do not deposit the advance tax installment on time, then you have to pay a penalty along with interest.
When and when to deposit advance tax
15 percent of the advance tax liability was to be deposited as the first installment by 15 June 2021. In the second installment, 45 percent of the total advance tax liability has to be deposited on 15 September 2021 i.e. today. In the third installment, 75 percent will have to be deposited by 15 December 2021. Finally, in the fourth installment, your 100% advance tax will be deposited. Its last date is 15 March 2022. If a taxpayer has not deposited the first installment of advance tax, he will have to deposit both the first and second installments today.