CMA Intermediate · Direct and Indirect Taxation · Advance Tax
Meera Traders, a regular assessee, has advance tax liability of ₹4,00,000 for the year. It paid ₹40,000 by 15th June and ₹1,20,000 on 15th September. What minimum amount must it pay on or before 15th December to satisfy section 408(1)?
Meera Traders must pay at least ₹1,40,000 by 15th December. The cumulative requirement is 75% of ₹4,00,000, which is ₹3,00,000, and section 408(1) reduces this by the ₹1,60,000 already paid in earlier instalments.
- A₹1,40,000Correct
- B₹1,80,000
- C₹3,00,000
- D₹1,00,000
Explanation
By 15th December cumulative payment must be not less than 75% of ₹4,00,000 = ₹3,00,000. Already paid = ₹40,000 + ₹1,20,000 = ₹1,60,000. Balance = ₹3,00,000 − ₹1,60,000 = ₹1,40,000. ₹1,80,000 wrongly uses 45% as the base for the instalment.
Did you get it right without looking?
One question tells you little. A timed set on Advance Tax shows your real accuracy, how long you take and where you lose marks.
More Advance Tax questions
- Meera Industries Ltd estimates that income-tax on its current income for the tax year will be Rs 2,60,000. Tax of Rs 45,000 will be deducted…
- In computing the 'assessed tax' for interest under section 424, which of the following is reduced from the tax on the total income?
- Meenakshi Traders Ltd estimates its current income for the tax year at Rs 40,00,000 and calculates income-tax on it at Rs 10,00,000 at the r…
- Under section 406 of the Income-tax Act, 2025, on what base does an assessee who is liable to pay advance tax compute the advance tax payabl…
- Mr. Ramesh Iyer, a resident aged 45 with business income, has paid the first two instalments of advance tax on his own accord based on an es…
- Under section 408(3) of the Income-tax Act, 2025, an advance tax payment made on 28th March 2027 will be treated as advance tax paid: