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CS Executive · Tax Laws and Practice · Procedural Compliance under Income Tax

Under section 405 of the Income-tax Act, 2025, advance tax payable is computed as A = B – C. What does C represent?

C is the income-tax deductible or collectible at source during the year on income already included in the specified sum, computed before deductions, where the payer has actually deducted or collected the tax. It is subtracted from the tax on the specified sum to arrive at advance tax payable.

  1. AIncome-tax deductible or collectible at source on income taken into account in the specified sum, computed before any deduction, where the tax was actually deducted or collectedCorrect
  2. BThe interest payable for deferment of advance tax
  3. CThe total tax due on returned income including surcharge
  4. DIncome-tax on net agricultural income only

Explanation

In section 405(1), B is income-tax on the specified sum at rates in force, and C is the tax deductible or collectible at source on income that is included in the specified sum (computed before deductions), provided the payer has paid or credited it after deduction or collection. Advance tax is thus reduced by TDS/TCS.

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