The instalment schedule
Advance tax is payable when the tax for the year, after TDS and TCS, is ₹10,000 or more. A resident individual aged 60 or more with no business or professional income is exempt. The cumulative instalments are 15% by 15 June, 45% by 15 September, 75% by 15 December and 100% by 15 March. If you declare income under the presumptive schemes (s.58 of the 2025 Act, formerly 44AD and 44ADA), the whole amount is due in one instalment by 15 March. Tax paid by 31 March still counts as advance tax.
Interest for deferment: s.425 [234C]
For each instalment, interest is 1% a month on the shortfall between the cumulative amount due and what you have paid: three months for June, September and December, one month for March. There is no June interest if you paid at least 12% by 15 June, and no September interest if you paid at least 36% by 15 September. The base is the "tax due on returned income", meaning tax on the return less TDS, TCS and specified reliefs. Under rule 119A of the 1962 Rules the amount on which interest is charged is rounded down to the nearest ₹100 verify (the 2026 Rules equivalent).
Interest for default: s.424 [234B]
If advance tax paid by 31 March is less than 90% of the assessed tax, interest is 1% for every month or part of a month from 1 April after the tax year to the date the income is determined (on processing or assessment) on the shortfall. Paying self-assessment tax before filing stops interest on the part paid. Under the self-assessment provision a payment is first set against interest, so the portal's figure can be marginally higher than shown here.
Worked example
Tax due ₹1,00,000, no TDS; paid ₹5,000 by 15 June, ₹20,000 more by 15 September, ₹10,000 by 15 December and ₹15,000 by 15 March. Interest under s.425 [234C] is ₹300 + ₹600 + ₹1,200 + ₹500 = ₹2,600 (the ClearTax illustration). Only ₹50,000 was paid, below 90%, so if the remaining ₹50,000 is paid and the return filed on 31 July, s.424 [234B] adds 1% × 4 months × ₹50,000 = ₹2,000.
Common questions
Which sections replace 234B and 234C?
In the Income-tax Act 2025, interest for default in payment of advance tax is s.424 (formerly 234B) and interest for deferment of advance tax is s.425 (formerly 234C). The rates and instalment percentages are unchanged.
I am salaried. Do I need to pay advance tax?
Only if tax on income outside salary — interest, rent, capital gains — leaves ₹10,000 or more unpaid after TDS. You can also ask your employer to deduct more TDS by declaring the other income.
Does a large capital gain in January attract interest for the earlier instalments?
No, if the tax on that gain is paid in the remaining instalments, or by 31 March where no instalment remains. This calculator does not apply that relief automatically; leave the gain out of the June–December figures if it arose later.