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CMA Intermediate · Direct and Indirect Taxation · Advance Tax

Under the Income-tax Act, 2025, an assessee becomes liable to pay advance tax during a financial year where the tax payable for that year, computed under the relevant Part, is at least which amount?

Advance tax is payable where the tax payable for the year, as computed under the Part, is Rs. 10,000 or more, as laid down in section 404. Lower figures such as Rs. 5,000 do not trigger the liability.

  1. ARs. 5,000
  2. BRs. 10,000Correct
  3. CRs. 20,000
  4. DRs. 50,000

Explanation

Section 404 provides that advance tax is payable where the amount of tax payable during the year is Rs. 10,000 or more. The other amounts are not thresholds in the section. Rs. 5,000 is a common mistaken figure.

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