Taxpayers required to pay advance tax for the financial year 2026-27 must meet the first instalment deadline on June 15, as part of India's pay-as-you-earn taxation framework. The advance tax system requires eligible individuals and entities to pay income tax in instalments throughout the year based on their estimated annual earnings, rather than settling the entire liability at the end of the financial year. The provision is aimed at ensuring a steady flow of tax revenue while reducing the burden of a lump-sum payment for taxpayers.

Under current income tax regulations, advance tax becomes applicable when a taxpayer's estimated tax liability exceeds Rs 10,000 in a financial year after accounting for Tax Deducted at Source (TDS) and Tax Collected at Source (TCS). The requirement covers a broad category of taxpayers, including salaried employees, self-employed professionals, consultants, business owners, landlords and investors. Taxpayers earning additional income through rent, capital gains, fixed deposit interest or other sources may also fall within the scope of advance tax provisions if their overall tax liability crosses the prescribed threshold.

However, certain exemptions are available under the law. Senior citizens aged 60 years or above are not required to pay advance tax, provided they do not earn income from a business or profession. The exemption offers relief to retired individuals who primarily rely on pensions, investments or other non-business sources of income. Senior citizens actively involved in business or professional activities, however, remain subject to advance tax requirements if their tax liability exceeds the specified limit.

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Taxpayers can make advance tax payments online through the Income Tax Department's e-filing portal. The process involves logging into the portal, selecting the e-Pay Tax option, choosing advance tax under the income tax category and entering the applicable assessment year details. Taxpayers must then provide the relevant tax amount, including any surcharge or cess, before completing the transaction using their preferred payment method.

Failure to comply with advance tax obligations may attract interest penalties under the Income Tax Act. If a taxpayer pays less than 90 percent of the total tax due by the end of the financial year, interest may be charged on the outstanding amount from April 1 of the following year. Additional interest can also be levied when prescribed advance tax instalments are missed or paid short of the required amount during the financial year.

Tax experts advise taxpayers to carefully estimate their annual income and tax liability well in advance of each due date to avoid penalties and interest charges. With the June 15 deadline marking the first instalment for FY 2026-27, eligible taxpayers are encouraged to review their income sources, assess any additional tax obligations and ensure timely compliance with advance tax requirements.

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