Direct and Indirect Taxes with Tax Ready Reckoner.
Section 211 of the Income Tax Act, 1961, mandates the payment of advance tax in four instalments during the financial year (FY) for most taxpayers, with specific due dates and percentages. Below is a detailed breakdown: 1. Regular Taxpayers (Non-Presumptive Income) [Section 211(1)(a)] DUE DATE % OF ADVANCE TAX PAYABLE (CUMULATIVE) KEY POINTS 15th June 15% First […]
[Section 211]: Instalments of Advance Tax & Due Dates Read More »
Under Section 234C of the Income Tax Act, taxpayers are generally required to pay advance tax in instalments. However, the first proviso to Section 234C(1) provides relaxation for certain types of income where estimating tax liability in advance is difficult, such as: Capital gains(short-term or long-term) Casual income(lottery, gambling, crossword puzzles, etc.) Dividend income(introduced in Budget 2021) New business income(if income
Payment of Advance Tax on Capital Gains & Casual Income [Proviso to Section 234C] Read More »
Section 218 of the Income Tax Act, 1961 deals with situations where a taxpayer is considered to be in default for non-payment or short payment of advance tax. Here’s a detailed analysis: 1. When is an Assessee Deemed in Default? An assessee is treated as being in default if: They fail to pay any instalmentof advance tax as
[Section 218]: Assessee Deemed to be in Default Read More »
Section 219 of the Income Tax Act, 1961 governs how advance tax payments are credited against a taxpayer’s final tax liability. Here’s a detailed analysis: 1. Basic Principle All advance tax paymentsmade during the financial year are fully credited to the taxpayer’s account Credit is given in the assessment year(AY) corresponding to the financial year (FY) of payment
[Section 219]: Credit for Advance Tax Read More »
Applicability: Section 234A(1) of the Income Tax Act, 1961, levies interest if an assessee fails to file their income tax return: Under Section 139(1)(Original due date), Under Section 139(4)(Belated return), or In response to a notice under Section 142(1)(Special notice for filing return). When is Interest Charged? Interest is charged if: The assessee has unpaid tax liability(after deducting TDS/TCS/Advance Tax). The return is not
[Section 234A (1)]: Interest for Default in Furnishing Return of Income Read More »
Section 234A(3) of the Income Tax Act, 1961, deals with interest payable when an assessee fails to file a return of income in response to a notice issued under Section 148 (reassessment) or Section 153A (search cases). This provision ensures compliance with tax filing obligations even in cases where the Income Tax Department reopens assessments or conducts searches. Key
Section 234A(4) of the Income Tax Act, 1961, deals with the adjustment of interest when there is a subsequent revision, appeal, or rectification that changes the tax liability after interest under Section 234A has already been charged. 1. When Does It Apply? Interest under Section 234A(1) or (3) may be recalculated if: The tax liability is modifieddue to: An appeal(e.g., CIT(A), ITAT, High Court, Supreme
[Section 234A (4)]: Increase/Decrease in Interest on Certain Orders Read More »
Section 234B(1) of the Income Tax Act, 1961, imposes interest if an assessee either: Fails to pay advance tax(even if liable), or Pays less than 90% of the total tax due(or 100% for non-tax audit cases). (A) Key Provisions of Section 234B(1) When is Interest Charged? Interest applies if: Advance tax paid is less than 90%of the actual tax liability (or 100% for non-tax
[Section 234B (1)]: Interest for Default in Payment of Advance Tax Read More »
Section 234B(3) deals with the recalculation of interest under Section 234B when the assessed tax is modified due to: Appeal orders(CIT(A), ITAT, High Court, Supreme Court) Revision orders(Section 263/264 by Principal CIT/CIT) Rectification orders(Section 154) Reassessment orders(Section 147/153A) 1. When Does It Apply? If the final tax liability changes after: An appeal/revision/rectificationreduces or increases the tax demand. The assessing officer modifiesthe tax payable. 2. Effect
[Section 234B (3)]: Interest Payable for Defaults in Payment of Advance Tax Read More »
Section 234B(4) of the Income Tax Act, 1961 provides for the adjustment of interest when there is a subsequent modification of the tax liability due to: 1. Applicable Orders Interest under Section 234B may be recalculated when tax liability changes due to: Appellate orders(CIT(A), ITAT, High Court, Supreme Court) Revision orders(under Section 263/264 by PCIT/CIT) Rectification orders(Section 154) Reassessment
[Section 234B (4)]: Increase/Decrease in Interest on Certain Orders Read More »
