Advance Tax Instalments Under Section 211: The 15/45/75/100 Schedule and the 234C Interest Risk

Advance tax is India's "pay as you earn" mechanism, and it trips up more honest taxpayers than almost any other compliance rule. Under Section 208 of the Income Tax Act 1961, every assessee whose estimated tax liability for the year is Rs 10,000 or more (after reducing TDS and TCS) must pay that tax in advance, not at the time of filing the return. The schedule is fixed by Section 211 into four dated instalments: 15%, 45%, 75% and 100% of the year's liability, due on 15 June, 15 September, 15 December and 15 March respectively. Miss any one of those dates and interest starts running under Section 234C, even if you eventually pay the full amount by 31 March.

This matters because the interest is automatic. There is no discretion, no waiver for a genuine cash-flow crunch, and the Central Processing Centre computes it the moment your return is processed. A salaried employee with only Form 16 income rarely worries about this because the employer deducts TDS every month. But the instant you add a capital gain, freelance income, rental income, or dividend above the withholding threshold, the four-instalment clock under Section 211 starts ticking on you personally. Use the Oquilia Income Tax Calculator to estimate your full-year liability first, then map it onto the 15/45/75/100 schedule below.

What the Section Says

Section 211 lays down a single, non-negotiable payment calendar for every taxpayer other than those covered by the presumptive schemes. The statutory language sets a minimum cumulative percentage that must be paid by each date, so the amounts build on one another rather than being four equal slices.

Two carve-outs sit inside the same section. First, an assessee declaring income on a presumptive basis under Section 44AD (small businesses) or Section 44ADA (professionals such as doctors, lawyers and architects) pays the whole of the advance tax in a single instalment on or before 15 March, instead of the four-part schedule. Understanding the presumptive taxation framework is essential before you assume you owe nothing until March. Second, any amount of tax paid by 31 March is treated as advance tax for that financial year, which gives a narrow window to top up before the year closes.

There is also a person-level exemption in Section 207: a resident individual aged 60 years or above who does not have any income chargeable under the head "Profits and gains of business or profession" is not liable to pay advance tax at all. A retired senior citizen living on pension and interest income therefore escapes the Section 211 calendar entirely, and settles any balance as self-assessment tax before filing. For a fuller definition of the concept itself, see the Oquilia glossary entry on advance tax.

Worked Example

Consider Meera, a freelance product designer taxed under the new regime for FY 2025-26. Her net taxable professional income after expenses is Rs 20,00,000, and she does not opt for presumptive taxation. Applying the FY 2025-26 new-regime slabs, her tax works out as follows.

Because her liability of Rs 2,08,000 exceeds the Rs 10,000 threshold and no TDS has been withheld, Meera must follow the Section 211 calendar. Her instalments are Rs 31,200 by 15 June (15%), a cumulative Rs 93,600 by 15 September (45%), a cumulative Rs 1,56,000 by 15 December (75%) and the full Rs 2,08,000 by 15 March 2026. She can compare regimes on the old vs new regime calculator before locking her estimate, since her instalment size depends on which regime she elects.

Now suppose Meera forgets the first two dates and pays nothing until December. Section 234C charges simple interest at 1% per month for three months on the shortfall in each of the first three instalments, and for one month on the final instalment.

By clearing the 75% mark in December and 100% in March, Meera stops further 234C interest, but the Rs 3,744 already accrued on the June and September defaults is non-refundable. Had she also paid less than 90% of Rs 2,08,000 by 31 March, a separate charge under Section 234B would apply at 1% per month from 1 April 2026 until she settled the balance.

Common Mistakes

These are the patterns that surface repeatedly in Section 234B and 234C interest additions during ITR processing and scrutiny.

Treating the 15% and 45% instalments as optional. Many taxpayers believe that paying 100% by 15 March avoids all interest. It does not. Section 234C tests each instalment date independently, so a June and September default still costs 1% per month for three months on those shortfalls, exactly as in Meera's Rs 3,744 figure above.

Forgetting the 12% and 36% safe harbours. The first proviso to Section 234C waives interest on the June and September instalments if you have paid at least 12% of the assessed tax by 15 June and at least 36% by 15 September. Taxpayers who aim for the exact 15% and 45% and fall marginally short by a rounding error sometimes escape interest under this tolerance, but only if they clear these lower floors.

Ignoring one-off capital gains and dividends. Because a capital gain cannot be foreseen at the start of the year, the law allows the tax on it to be paid in the remaining instalments falling due after the gain arises, with no 234C interest for the earlier instalments. Taxpayers who instead defer the entire tax to March lose this relief. Estimate the gain first on the capital gains calculator.

Presumptive taxpayers assuming quarterly instalments. A Section 44ADA professional owes 100% by 15 March in one shot. Splitting it into four wrongly-sized payments does not breach the rule, but paying only a fraction by 15 March triggers 234C at 1% for one month on the balance.

Confusing advance tax with self-assessment tax. Tax paid after 31 March is self-assessment tax under Section 140A, not advance tax, and does not stop the 234B meter. If you missed the deadlines, pay immediately rather than waiting for the return; and if you also missed the filing window, review the route to file a return after condonation of delay under Section 119(2)(b).

FAQ

Who has to pay advance tax in India?

Under Section 208, any taxpayer whose estimated tax liability for the year, after subtracting TDS and TCS, is Rs 10,000 or more must pay advance tax. Resident senior citizens aged 60 or above with no business or professional income are exempt under Section 207.

What are the four advance tax due dates for FY 2025-26?

Section 211 fixes them at 15 June (15% cumulative), 15 September (45%), 15 December (75%) and 15 March 2026 (100%). Any tax paid up to 31 March 2026 is still treated as advance tax for the year.

How is Section 234C interest calculated?

It is simple interest at 1% per month, charged for three months on the shortfall in each of the first three instalments and for one month on the final 15 March instalment. It applies only where you fall below the 12% (June) and 36% (September) safe-harbour floors for those two dates.

What is the difference between Section 234B and Section 234C?

Section 234C penalises the timing of instalments within the year, while Section 234B penalises an overall shortfall: if you pay less than 90% of the assessed tax by 31 March, 234B charges 1% per month from 1 April of the assessment year until the balance is cleared.

Do presumptive taxpayers under 44AD and 44ADA pay in instalments?

No. They pay the entire advance tax in one instalment on or before 15 March. A shortfall on that single date attracts 234C interest at 1% for one month.

How do I pay advance tax?

Advance tax is deposited online through Challan 280 (now the e-Pay Tax service) on the income tax portal at incometax.gov.in, selecting the "Advance Tax (100)" code and the correct assessment year.

Can I revise my advance tax estimate mid-year?

Yes. Section 211 works on your best current estimate, so if income rises after a large September project or capital gain, you increase the December and March instalments accordingly, using the remaining dates to catch up without 234C interest on the newly arising income.