Navigating the Process of Submitting Advance Tax for Assessment Year 2021-22

Did you know that for the assessment year 2021-22, if your total computed tax for the year exceeds Rs 10,000, you are required to pay advance tax? This article will guide you through the process of submitting advance tax for the upcoming year. Whether your income sources include salaries, rental income, capital gains, or interest from bank deposits, understanding the steps is crucial.

When Advance Tax is Required

For individuals with salaries as the primary source of income, advance tax is not always mandatory. This is because the employer deducts tax at source (TDS) from salaries and deposits it monthly with the Income Tax Department (ITD). However, if you also have income from additional sources, such as rental income, capital gains, or interest from bank deposits, and this income has not been reported to your employer, you may need to pay advance tax if your total tax liability exceeds Rs 10,000 annually.

Payment Installments

The process of paying advance tax is structured into four installments spread over the year, ensuring that tax liability is managed effectively. Here are the deadlines for each installment:

First Installment: By 15th June, you should pay 15% of your tax liability. Second Installment: By 15th September, you will need to pay an additional 45% of your tax liability. Third Installment: By 15th December, you should pay another 75% of your tax liability. Fourth Installment: By 15th March, the final 100% of the tax liability must be paid.

How to Submit Advance Tax

To submit your advance tax, follow these detailed instructions:

Login to the Income Tax E-Filing Website:
Begin by logging into the official Income Tax e-Filing website. Access the E-Payment of Taxes:
Navigate to the 'e-payment of Taxes' section. This will take you to the online services website, Select Challan 280:
Once you have accessed the online services website, select 'Challan 280' for paying advance tax. Fill in the Required Details:
Enter all necessary details as prompted on the form, including the challan number, PAN (Permanent Account Number), and the amount you are paying. Choose the Netbanking Option:
For a secure and convenient payment method, choose the 'Netbanking' option to make the payment online. Review and Confirm the Payment:
After entering the details and verifying the amount, click on the 'Make Payment' button to confirm the transaction. Receive the Challan Certificate:
A successful payment will display a challan certificate on the screen. This certificate will contain important information such as the information number, payment details, and the bank name used for the e-payment.

It is crucial to keep the challan certificate as proof of the payment made. In case of any discrepancies or queries, the challan certificate serves as a formal record of the tax payment.

By following these steps, you can ensure compliance with the advance tax requirements for the assessment year 2021-22. Remember, timely payments can help avoid penalties and interest. If you are unsure about your tax liability, you might consider consulting a professional or visiting the official Income Tax Department website for further guidance.

Conclusion

Understanding the process of paying advance tax for the assessment year 2021-22 is essential for individuals with various sources of income. By adhering to the deadlines and following the guidelines outlined in this article, you can ensure that your tax obligations are met promptly and accurately. Use the information provided here to manage your tax responsibilities effectively and avoid any potential complications.