Suppose my tax liability at the end of the FY is 12k. Do I have to calculate the advance tax each qtr on the basis of qtr income or on the basis of yearly estimated salary ?
Consider trading
I did not earn money till 15th March
Earned some money from 16th March
How is advance tax calculated in that case
Hey @dtyxg,
Both intraday and F&O trading is considered as business income.
In the case of business income, the income needs to be estimated and advance tax needs to be paid. So, even if you earn profits after the 15th, youâd have to estimate the profits and pay the advance tax before the due date.
Hope this helps!
Hey @Sourav_Konar,
Advance tax needs to be paid by estimating your total income for the entire year.
To calculate your tax liability, you are required to
- Estimate all your earnings in a given year
- Subtract the amount of deductions eligible
- Compute the tax liability as per the latest slab rates (special rates in case of capital gains) and the regime opted for.
- If the tax liability exceeds âš10,000, then you need to pay advance taxes.
- If any TDS was already paid, account for the same and make the advance tax payment for the remaining tax liability.
Hope this clarifies your query.
I donât think that will be counted as realised capital gains if you buy them in same day.
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Hey @EasyMoney,
Yes, you can explore our product, integrate your broker account and plan your taxes. Only in the case of certain features, you might have to opt for our PRO Plan.
Hope this helps!
Suppose my LTCG is 1.9L if I redeem my shares now, I need to pay tax of almost 9k.
Now if I gift half of stocks to my mother (relative gifting), and then sell shares I/my mother wonât have to pay any taxes, since individual LTCG will be less than 1L then. Am I right?
Hey @iamirshad,
According to the Income Tax Act, gifts from relatives are exempted from taxes. Hence, the shares that you gift to your mother will not be taxable. Moreover, when she sells the shares, if the LTCG is less than âš1lakh, it will be exempted from taxes.
Hope this clarifies.
@Quicko Missed paying advance tax yesterday due to some issue, can I pay advance tax today? If I pay today (after march 15) should I select Advance tax or self assessment tax? Thanks.
Hey @zerodhahero,
Yes, any taxes paid between 15th to 31st March is also considered as advance tax.
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Requested a call back yesterday.
Today isnât a working day for you guys?
- But penalty will be levied right if there is shortfall in taxes?
- If we additionally (more than actual tax amount) what is the interest rate given to the tax payer and how it is calculated?
@Quicko
@Quicko
Made no advance tax payments till now
Can I pay my taxes in full today and avoid interest penalty ?
Hey @gowtham4,
Yes, the penalty will be levied in case of any deferment in payment of advance tax u/s 234C.
Moreover, the excess taxes paid can be claimed as a refund while filing the ITR. You will get an interest of 0.5% per month which is paid from 1st April till the date on which the refund is issued.
Hope this helps!
Hey @dtyxg,
Interest penalty under section 234C is imposed when there is a deferment in payment of advance tax, which means, that the advance tax is not paid on a quarterly basis.
If you pay any taxes between the 16th to 31st of March, those will be treated as advance taxes and penal interest will also be applicable.
Hope this clarifies!
What if I want to CARRY FORWARD previous year loss.
This year profit less than last yearâs loss
Should I pay advance tax in this case ?
Only 1%penalty per month till the 31st October, the last date of filing ITR as audit is there,
so the tax amount can be seen as a loan of 1% per month,
so is it a better idea to not pay the advance tax at all and use that money as a loan for 7 months ??
Yes ; but only if you are making guaranteed more than 1% per month
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Hey @dtyxg,
The tax liability for the financial year is calculated after taking into consideration any losses that are being set off against the profits.
After that, if the estimated tax liability goes beyond âš10,000, then only you are liable to pay advance tax.
Hope this clarifies.
I have only trading income (equity and futures & options), and itâs less than 500,000. My trading capital originated from outside of India while I was working as an NRI. Now, I am no longer an NRI. Monthly, I am investing approximately Rs 12,000 in mutual funds through SIP. Additionally, I have a family health insurance policy taken out in 2022 for 3 years and make monthly deposits in the âSukanya Samriddhi Yojanaâ for my daughter. I havenât filed ITR before. How can I file my ITR, and which tax regime can I choose?