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CA Intermediate · Taxation · Tax Deduction or Collection at Source and Advance Tax

Meena Iyer, a resident salaried individual aged 38 with no business income, estimates that her tax payable for tax year 2026-27, after allowing TDS already deducted by her employer and TDS on her bank interest, will be Rs 9,000. Which statement about her advance tax obligation is correct?

Meena need not pay advance tax because her net tax payable after TDS is Rs 9,000, which is below the Rs 10,000 limit. Advance tax applies only when the remaining liability is Rs 10,000 or more. Being a salaried person is not the reason for exemption.

  1. AShe must pay the full Rs 9,000 by 15 March 2027 as a single instalment
  2. BShe must pay Rs 9,000 in four instalments of 15%, 30%, 30% and 25%
  3. CShe is not liable to pay advance tax because the tax payable is below Rs 10,000Correct
  4. DShe is not liable to pay advance tax because she is a salaried person

Explanation

Advance tax is payable only when the tax payable for the year, after reducing TDS and TCS, is Rs 10,000 or more. Meena's net liability is Rs 9,000, which is below this limit, so no advance tax arises. Being salaried does not by itself exempt a person; a salaried person with a net liability of Rs 10,000 or more would have to pay.

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