What is the Advance Tax and why it is paid in Advance?

Tax is a major source of fund for any Government in the world. In India as per general provision of the Income Tax Act, 1961 every person whose income is exceeds threshold exemption limit is liable to pay income tax. However for speedy and efficient tax collection a mechanism is developed by government in the form Advance Tax. Advance tax is a payment mechanism in which tax is deposited by assessee in installment instead of entire amount deposited at the end of financial year. For assessee’s point of view advance tax is helpful for fund management as the tax liability is divided in installments.

What is meant by self-assessment tax?

Self Assessment tax means any balance tax paid by the assessee on the assessed income after taking TDS and Advance tax into account before filing the Return of income.

What are the Statutory Provisions for payment of Advance Tax in India?

Following are the sections of the Income Tax Act, 1961 which deal with the provisions of advance tax:

• Section 208: Conditions of liability to pay advance tax
• Section 209: Computation of advance tax
• Section 210: Payment of advance tax by the assessee of his own accord or in pursuance of order of Assessing Officer.
• Section 211: Installments of advance tax and due dates.