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The month of March has its own significance in many ways. Be it in terms of being considered the last month for making tax-saving investments or return filing or discharging taxes due for the year and so on. Amongst these, this month also stands out as crucial for those who must pay taxes in advance or what is called ‘advance taxes’.
Advance taxes are, as the name suggests, advance tax is simply a tax paid in advance. In general, tax return for income earned in the financial year i.e., 12 month period starting on April 1st and ending on 31st March will be filed in the next financial year. However, the government has designed a mechanism to collect taxes at regular intervals to ensure cash inflow throughout the year. This helps the government meet expenses on time.
And avoids collection of taxes after the year-end in one lump sum. Tax paid for income earned in the financial year in the same financial year before filing return of income, at specified intervals, is advance tax. Further, the advance tax must be paid if you still have a tax payable of Rs 10,000 or more after considering the TDS, which has already been deducted. To explain this further, the salaried class generally would not have to pay advance tax unless they have income other than salary, because TDS is already made by their employer. However, if they have incomes such as rental or interest income on which TDS has not been deducted, the advance tax would apply.
As 15 March 20X1 which is the due date for payment of the last installment of advance taxes for individuals, one needs to know how to go about paying the same.
Online mode –
In order to pay taxes using the electronic mode, the taxpayer should have net banking enabled account in any of the authorized banks. E-payment of tax can also be made by using a debit card, however, only 5 banks are authorized for this purpose (ICICI, HDFC, Indian bank, Punjab National, and SBI).
In case the taxpayer does not have net banking enabled account or debit card of the above banks, payment of tax can be made in the taxpayer’s names by any other person having net banking enabled account or debit card of an authorized bank.
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