Advance Tax 15 December 2026: Who Pays, Calculation, Payment
The December advance tax instalment is due on 15 December 2026. Learn who must pay, how to calculate 75% of your tax, how to pay online and what interest applies if you fall short.
The third advance tax instalment for the tax year 2026-27 is due on Tuesday, 15 December 2026, and by that date you should have paid at least 75% of your estimated tax for the year. This guide explains who has to pay, how to work out the December amount with a worked example, how to pay online through the e-Pay Tax service on the income tax portal, and how interest is charged if you pay late or pay too little.
Updated November 2026. The Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026, so section numbers have changed. Tax rules and portal screens change often; confirm details on the official portal or with a chartered accountant before you pay.
Key Takeaways
- Advance tax applies if your estimated tax for the year, after TDS and TCS, is Rs 10,000 or more.
- By 15 December 2026 you must have paid 75% of your estimated tax in total, not 75% in this one instalment.
- Resident senior citizens (60+) with no business or professional income are exempt; presumptive taxpayers can pay everything by 15 March.
- Pay through e-Pay Tax on incometax.gov.in, choosing “Advance Tax” as the type of payment, and keep the challan details for your return.
- A shortfall in the December instalment attracts 3% interest on the shortfall; underpaying for the full year attracts 1% per month separately.
Advance Tax December 2026: Quick Answer
| Question | Answer |
|---|---|
| Due date | Tuesday, 15 December 2026 |
| Tax year | 2026-27 (income earned 1 April 2026 to 31 March 2027) |
| Cumulative amount due by this date | 75% of estimated tax for the year |
| Who must pay | Anyone whose estimated tax after TDS/TCS is Rs 10,000 or more |
| How to pay | e-Pay Tax on incometax.gov.in (the old Challan 280 route), type of payment: Advance Tax |
| Interest if short | 3% of the shortfall for the December instalment |
| Next and final instalment | Monday, 15 March 2027 (100%) |
What Changed in 2026: New Act, Same Calendar
From 1 April 2026 the Income-tax Act, 2025 governs income tax. The new law uses the term “tax year” for what we used to call the previous year, and it renumbers almost every section. For advance tax, the structure is broadly the same as before. Tax commentators map the main provisions like this:
| Topic | Old Act (1961) | New Act (2025) |
|---|---|---|
| Advance tax liability, computation and instalments | Sections 207 to 211 | Sections 403 to 408 |
| Interest for not paying enough advance tax for the year | Section 234B | Section 424 |
| Interest for deferring individual instalments | Section 234C | Section 425 |
| Presumptive business and professional income | Sections 44AD and 44ADA | Section 58 |
Many websites, tools and even notices will keep saying “234B” and “234C” for a while. They mean the same two kinds of interest. Check the bare Act text or your CA if a notice quotes a section number you do not recognise.
Who Must Pay Advance Tax
The test is simple: estimate your total tax for the tax year, subtract TDS and TCS that will be credited to you, and if the balance is Rs 10,000 or more, you pay advance tax in instalments.
Usually liable
- Business owners and professionals who keep regular books and do not opt for presumptive taxation.
- Salaried people with significant other income: rent, interest from fixed deposits, capital gains, dividends or freelance work on the side, where TDS does not cover the tax.
- Investors with large capital gains during the year.
- Firms and companies.
Usually not liable, or on a different schedule
- Resident senior citizens aged 60 or more with no income from business or profession do not have to pay advance tax. They can pay self-assessment tax before filing the return.
- Presumptive taxpayers (small businesses and professionals declaring income on a presumptive basis) can pay the whole advance tax in one instalment by 15 March. If you choose to pay earlier, that is fine too.
- Salaried people whose employer deducts full TDS and who have little other income often end up below Rs 10,000.
Special cases worth checking
- Stock market investors: if you booked large gains between October and December, add the tax on them to your December estimate. Gains booked after 15 December can be covered in the March instalment.
- Non-resident Indians: NRIs with Indian rental or capital gains income are also covered by the Rs 10,000 rule, although TDS on most of their income often brings the balance below it.
- People who changed jobs: two employers each applying the basic exemption can leave a tax gap. Recalculate your total salary and tax for the year.
- Small companies and LLPs: the instalment percentages are the same, and the company’s or LLP’s tax is computed at its own rate.
Instalment Schedule for Tax Year 2026-27
| Due date | Cumulative % of estimated tax | Status as of November 2026 |
|---|---|---|
| 15 June 2026 | At least 15% | Past |
| 15 September 2026 | At least 45% | Past |
| 15 December 2026 | At least 75% | Upcoming |
| 15 March 2027 | 100% | Final |
Any tax paid up to 31 March 2027 is treated as advance tax for the year, but paying after the instalment date still triggers interest for the delay.
How to Calculate Your December Instalment: Worked Example
Take an illustrative example. Vidhaata Traders is a proprietorship in Rajkot that keeps regular books and does not use presumptive taxation. In early December the owner sits down with the accounts.
Step 1: Estimate the full year’s income
Take actual profit from April to November, then project December to March realistically. Include every other source: rent, FD interest, capital gains already booked, dividends. Suppose total estimated taxable income comes to Rs 18 lakh.
Step 2: Compute tax on that income
Apply the rates for the regime you will use (new regime is the default; the old regime is optional for eligible taxpayers), add surcharge if applicable and the 4% health and education cess. Suppose the total tax works out to Rs 2,70,000.
Step 3: Subtract TDS and TCS
Check Form 26AS and the Annual Information Statement (AIS) on the portal. Suppose Rs 30,000 of TDS has been or will be credited (on FD interest and some professional receipts). Net estimated tax = Rs 2,40,000. That is above Rs 10,000, so advance tax applies.
Step 4: Apply the cumulative percentages
| Instalment | Cumulative due | Already paid | Pay now |
|---|---|---|---|
| 15 June (15%) | Rs 36,000 | Rs 36,000 | Done |
| 15 September (45%) | Rs 1,08,000 | Rs 1,08,000 | Done |
| 15 December (75%) | Rs 1,80,000 | Rs 1,08,000 | Rs 72,000 |
| 15 March (100%) | Rs 2,40,000 | Rs 1,80,000 | Rs 60,000 (in March) |
The December payment is the difference between 75% of the estimate and what you have paid so far. If business picked up after September, your estimate rises, and the December payment absorbs the catch-up. That catch-up is exactly why December is the instalment people most often get wrong.
Step 5: Re-check in March
Your final instalment should take the year’s actual numbers into account. If you overpaid, you get a refund with interest after filing the return; if you underpaid, pay the balance by 15 March to limit interest.
Interest if You Pay Late or Pay Less
Deferment interest (old 234C, new section 425)
For the June, September and December instalments, a shortfall attracts interest of 3% of the shortfall amount; for the March instalment it is 1%. This is the same as the old method of 1% per month for three months. The calculation is based on tax on your returned income.
Example: if Vidhaata Traders had paid only Rs 1,30,000 in total by 15 December instead of Rs 1,80,000, the shortfall is Rs 50,000 and deferment interest is about 3% of that, roughly Rs 1,500.
There is relief for the first two instalments: no interest if you paid at least 12% by June and 36% by September. There is no such cushion for December.
Default interest (old 234B, new section 424)
If the advance tax you paid during the whole year is less than 90% of your assessed tax, simple interest of 1% per month (or part of a month) is charged on the shortfall from 1 April after the tax year until the tax is paid or assessed.
Income you could not predict
If a shortfall arises because of income you could not have foreseen, such as capital gains, lottery or similar winnings, dividends, or business income in the first year, the law gives relief from deferment interest provided you pay the tax on it in the remaining instalments or by 31 March. Keep notes on when such income arose.
How to Pay Advance Tax Online (e-Pay Tax, formerly Challan 280)
Physical Challan 280 forms are history; you now generate a Challan Form (CRN) on the income tax portal. The official Create Challan Form (CRN) user manual walks through the screens. The short version:
- Log in to the income tax e-filing portal with your PAN, or use the pre-login e-Pay Tax option, which asks for your PAN and a mobile number for OTP.
- Go to e-File > e-Pay Tax and click New Payment.
- Select the Income Tax tile.
- Choose the year carefully. You are paying for income earned from 1 April 2026 to 31 March 2027; read the label on the drop-down (assessment year or tax year) and pick the one that matches this period.
- Choose Advance Tax as the type of payment (minor head).
- Enter the amount break-up: tax, surcharge if any, and cess. The total must be more than zero.
- Select a payment mode: net banking, debit card, payment gateway, pay at bank counter, or RTGS/NEFT. You cannot change the mode once the CRN is generated.
- Pay. A CRN is valid for 15 days, but do not cut it fine; pay on or before 15 December.
- Download the challan receipt. Note the BSR code, challan serial number and date of payment; you will need them in your income tax return.
The portal’s tax payment modes guide lists which banks support each mode.
Common Mistakes to Avoid
- Choosing the wrong year. This is the most common error. A payment tagged to the wrong year does not count for this year’s instalments; corrections are possible but slow.
- Choosing self-assessment instead of advance tax. Before 31 March, pick Advance Tax.
- Paying on the last evening. Banks and the portal can be slow around 15 December. Pay a few days early.
- Ignoring capital gains. If you sold shares, mutual funds or property this year, include the tax on those gains in your estimate.
- Forgetting TDS mismatches. Check AIS before counting on TDS. If a deductor has not deposited it, you may owe more.
For other dates in the same quarter, see our list of income tax due dates for October to December 2026.
Frequently Asked Questions
What is the last date for the third advance tax instalment in 2026?
15 December 2026, a Tuesday. By then you must have paid at least 75% of your estimated tax for the tax year 2026-27 in total.
Do salaried employees need to pay advance tax?
Only if their tax after TDS is Rs 10,000 or more for the year. This usually happens when they have rental income, interest, capital gains or freelance income that their employer’s TDS does not cover.
I missed the September instalment. What should I do now?
Pay the full cumulative amount due by 15 December, that is 75% of your estimated tax minus what you have paid. Interest for the September shortfall will still apply, but paying now stops a larger December shortfall.
Is Challan 280 still used?
The name is still used informally, but payment now happens through e-Pay Tax on the income tax portal, where you generate a CRN and choose Advance Tax as the type of payment.
Do freelancers on presumptive taxation need to pay in December?
No. Presumptive taxpayers may pay the entire advance tax by 15 March. Paying some of it earlier is allowed and does no harm.
What happens if I overpay advance tax?
The excess is refunded after you file your return and it is processed, with interest as per the law. It is still better to estimate carefully than to park extra money with the government.
Before 15 December: A Short Checklist
- Update April to November profit or income figures.
- Add realistic projections for December to March.
- Check AIS and Form 26AS for TDS credits.
- Compute tax and 75% of it; subtract what you have already paid.
- Generate the CRN with the right year and Advance Tax selected, pay, and save the receipt.
Tax law under the new Act is still settling in, and rates, forms and portal labels can change. Use this guide to prepare your numbers, then confirm the final figure with your CA or the official portal before paying.
