Advance Tax

Tax-payers are required to pay advance tax on their income which they expect to earn during the current year.For example, for financial year 2008-09 (relevant to assessment year 2009-10)

• Advance tax is payble in instalment during 2008-09 itself.
• The advance tax so paid is adjusted against the total tax assessed for that assessment year.

For example, if your total tax is Rs.10000 for assessment year 2009-10 and you have already paid Rs.5000 as advance tax then your tax liability will be Rs. 5000 i.e. (Rs. 10000-Rs.5000).

Note: If the tax payable after all deductions, rebates and TDS for a financial year is Rs. 5,000, or less then no advance tax is payable.

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