The due date to pay your 2nd advance tax instalment is just round the corner and you must pay it to avoid interest penalties.
See, most of us think — “ why pay our taxes now when we can do it at the time of filing the ITR, all in one go.” You can do that, but it gives rise to two problems.
One, the lumpsum amount may be large making it difficult for you to arrange the funds and, two interest at the rate of 1% per month will accumulate on the unpaid amount. So at the year-end, you end up paying more taxes than you were actually liable for. Hence, better to pay off your taxes as and when you earn your income.
For this quarter, you need to pay at least 45% of your total tax liability by 15th September 2024.
Once the payment is successful, you’ll be able to download the challan. Moreover, this tax payment will be also reflected in your AIS within a week or two.
Advance Tax on capital gains is to be paid when the gains are realised and not on estimated basis. Thus, if you sell any MF post 15th march but before 31st march and earn capital gains, you need to pay advance tax on or before 31st march. In that case, there will be no interest penalty. Else, interest at 1% per month will be levied starting from March till the date you pay the tax.
What will be the tax rate for advance tax calculation on LTCG realised on unlisted shares by NRI ?
The transaction was done in May 2024.
Please let me know.
yeah, govt expects you to magically know what will you make in entire year and pay tax in advance on that. Even for ‘speculative’ trading income.
So realistically, i always have to pay interest.
All i can do is pay tax on what i have made so far minus some fraction of estimated potential drawdawn. Else you might pay too much tax and no interest paid by govt within FY and even after that they pay half the rate they take.
In so many ways, they just keep adding multiple small % over slab rates.
Other than capital gains, on all other incomes you are liable to estimate your total income for the entire year and pay the taxes accordingly.
In case you pay more taxes than you are liable for, you can claim a refund at the time of filing the ITR. Once your ITR gets processed, you receive the refund.
Advance tax is payable on all types of incomes. However while on other incomes you have to ‘estimate’ the total earnings for the entire FY and pay the tax, for capital gains you can pay tax in the quarter based on when you realise the gains.
