How to Pay Advance Tax Online: Challan 280 Step-by-Step Guide

Advance tax is the income tax paid in instalments during the financial year instead of a lump sum at year end. If your total tax liability exceeds ₹10,000 in a year, you are required to pay advance tax. This guide explains who should pay, the due dates, and how to pay online using the e-Pay Tax portal.

What is Advance Tax?

Advance tax is the "pay-as-you-earn" system of income tax. Instead of paying all tax at the time of filing ITR, you estimate your income and pay tax in quarterly instalments. It applies to all types of income — salary, business, profession, capital gains, rent, interest, etc.

Note: Salaried individuals whose employer deducts full TDS generally don't need to pay advance tax. It's mainly for freelancers, business owners, and those with income from multiple sources.

Who Should Pay Advance Tax?

You must pay advance tax if:

• Your total tax liability for the year (after TDS) exceeds ₹10,000
• You have income from business or profession
• You have capital gains (not covered by TDS)
• You earn rental income, freelance income, or interest income where TDS is insufficient

Exempt: Senior citizens (60+ years) with no business/professional income are exempt from advance tax.

Advance Tax Due Dates

Advance tax must be paid in 4 instalments:

For taxpayers under Presumptive Scheme (Section 44AD/44ADA): Entire advance tax can be paid in one instalment by 15th March.

How to Pay Advance Tax Online (Step-by-Step)

Step 1: Visit e-Pay Tax Portal

1. Go to Income Tax e-Pay Tax
2. Enter your PAN number and mobile number
3. Click "Continue" and verify with OTP

Step 2: Select Tax Payment

1. After login, click "Income Tax" tile
2. Select Assessment Year (e.g., AY 2027-28 for FY 2026-27)
3. Select Type of Payment: (100) Advance Tax
4. Click "Continue"

Step 3: Enter Tax Details

1. Enter the tax amount under the correct head:
   • Income Tax: Your advance tax amount
   • Surcharge: If applicable (income above ₹50 lakh)
   • Health & Education Cess: 4% of (Income Tax + Surcharge)
2. Verify the total amount

Step 4: Choose Payment Method

Select your preferred payment mode:

• Net Banking: Pay through your bank's internet banking
• Debit Card: Pay using debit card (some banks supported)
• Pay at Bank Counter: Generate challan and pay at authorized bank
• NEFT/RTGS: Transfer to RBI account with generated challan details
• UPI: Pay using UPI ID (available for some banks)

Step 5: Complete Payment

1. Select your bank and proceed to payment gateway
2. Complete the payment through your bank
3. After successful payment, you receive a challan receipt (CRN)
4. Save and print the challan — this is your proof of payment

Step 6: Verify Payment

1. Go to e-Pay Tax → Payment History on Income Tax portal
2. Your payment should reflect within 24-48 hours
3. It will also appear in your Form 26AS within a few days

Understanding Challan 280

Challan 280 (now called ITNS 280) is the form used for paying income tax, including advance tax. Key fields:

Penalty for Not Paying Advance Tax

If you don't pay advance tax or pay less than required:

Example: If your total tax liability is ₹1,00,000 and you paid zero advance tax:

• Section 234B: 1% per month × ₹1,00,000 × number of months from April to date of payment
• Section 234C: Additional interest for missing each quarterly deadline

How to Calculate Advance Tax

1. Estimate total income for the financial year from all sources
2. Calculate tax as per applicable slab rates
3. Subtract TDS already deducted or expected to be deducted
4. If remaining tax > ₹10,000, pay advance tax in quarterly instalments
5. Use the Income Tax Calculator or any online advance tax calculator

Important Tips

1. Estimate conservatively — it's better to pay slightly more and claim refund than face interest penalty
2. Pay before the due date — even one day late attracts interest under Section 234C
3. Keep challan receipts safely — you need the BSR code and challan number while filing ITR
4. Capital gains can be paid as advance tax in the quarter they arise (no need to pay in earlier quarters)
5. Revise estimates quarterly — if income increases, increase subsequent advance tax payments

Frequently Asked Questions

Q1. What is the minimum amount for advance tax?

If your total tax liability after TDS exceeds ₹10,000 in a financial year, you must pay advance tax.

Q2. Can salaried employees pay advance tax?

Yes. If you have income beyond salary (capital gains, rental income, freelancing) and total tax after TDS exceeds ₹10,000, you should pay advance tax.

Q3. What if I miss an advance tax deadline?

You can still pay the tax, but interest under Section 234C (1% per month on shortfall) will apply for the delayed period.

Q4. Can I pay advance tax in one lump sum?

Yes, you can pay the entire amount in any instalment. However, interest under Section 234C may apply for earlier missed instalments.

Q5. How do I know my advance tax has been credited?

Check Form 26AS on the Income Tax portal or go to e-Pay Tax → Payment History. The payment reflects within 2-5 working days.

Q6. What is the difference between advance tax and self-assessment tax?

Advance tax is paid during the financial year in instalments. Self-assessment tax (Type 300) is paid at the time of filing ITR for any remaining tax liability.

Q7. Is there advance tax for senior citizens?

Senior citizens (60+ years) without business or professional income are exempt from advance tax. All others must pay if liability exceeds ₹10,000.

Disclaimer: CitizenNest is an independent platform and is not affiliated with the Income Tax Department or any government body. Information is based on official sources and may change. Always verify on the official Income Tax portal.