Penalty for not paying advanced tax - if you don't quality for presumptive filing

I was in impression that we will be able to pay advanced tax before march because we thought we can file presumptive tax filing. But now it looks like we can not opt for presumptive taxation scheme. So it means we did not pay advanced quarterly tax that we were suppose to pay.

So do they charge penalty in every case or there are some exceptions or tricks to avoid interest penalty?
I believe every time one needs audit …he was suppose to file advanced tax correct?

@San78 @Quicko

Hey @curiousvi

Interest under section 234C will be charged for the delay/non-payment of advance tax during the year @1% per month on the shortfall amount. Moreover, Section 234B is the penalty interest imposed on the taxpayers in case the advance tax payment is less than 90% of assessed tax liability during the year.

You can avoid interest u/s 234B by paying at least 90% of your assessed tax liability by March 15, 2021.

Hope this helps! :slight_smile:


So because we did not pay quarterly advanced payment there is not way to avoid interest under 234c correct? i.e. 1% per month starting June 2020? (unless somehow we can figure out way to file presumptive tax)
But we can save on 234B penalty interest if we pay at 90% of tax liability before March 15 but I am not sure what will be total tax liability by 31st March 21? so I guess we should pay lum sum amount and may ask for refund ?

Also while I checked how to pay advanced pay via challan …along with tax …it was showing all other rows like cess etc…so do we need to enter in those columns or just put round figure in tax row?

Hey @curiousvi

You are correct. You should pay the estimated lump sum amount in tax column before March 15 so as to save interest under section 234B.