The CBDT on Sunday extended till December 31 the deadline for making advance tax payments for the northeastern states amid protests against the amended Citizenship Act, Economic Times reported.
The third installment of advance tax payment (payment of tax liability before the end of financial year) was due on December 15. Also known as “pay-as-you-earn” scheme helps government get a constant flow of income throughout the year.
“…CBDT has decided to extend the date for payment of 3rd instalment of Advance Tax for financial year 2019-20 from 15th December, 2019 to 31st December, 2019 for the North Eastern Region,” the Central Board of Direct Taxes (CBDT) said on Twitter.
According to Section 208 of the Income Tax Act, 1961, if estimated tax liability for any given financial year crosses ₹10,000 then advance tax is supposed to be paid. Accounts department of salaried individual already deducts advance tax from salary as and when needed.
If individuals from non-salaried income such as interest from a bank deposit or capital gains from assets such as shares, mutual funds or real estate, miss the deadlines (which come four times in a financial year) they may get a penalty of one per cent a month for non-compliance, Livemint reported.
Finance Bill 2016-17 suggests an individual assessee to pay advance tax in four instalments, instead of three earlier. The first is due on 15 June each year, by when 15 per cent of tax liability have to be deposited. By 15 September 45%, by 15 December 75% of the tax and by 15 March all of it.