Advance Tax Payment on December 16 Due to Holiday on December 15
Taxpayers with an income tax liability exceeding ₹10,000 are required to pay advance tax as per the Income Tax Act’s quarterly schedule to avoid penal interest and penalties. For the financial year 2024-25, the due date for the third installment is December 15, 2024. However, since this date falls on a Sunday (a public holiday), taxpayers may wonder whether they can pay on December 16, 2024 (Monday).
Payment Allowed on the Next Working Day Without Penalty
Yes, you can pay the advance tax on December 16, 2024, without incurring penal interest under Sections 234B and 234C.
This is based on a 1994 Circular issued by the Income Tax Department, which states:
If the due date falls on a public holiday, the payment made on the next working day will be considered as paid on time.
No penalty or interest will be charged for such delayed payments.
Circular Reference:
The circular dated January 14, 1994, clarifies:
“If the last date for payment of any installment of advance tax is a day on which the receiving bank is closed, the payment on the next working day will not attract penalties under Sections 234B and 234C.”
Expert Opinions
Tax Compliance:
Experts confirm that taxpayers can make payments on December 16, 2024, without worrying about penal interest.
In Case of Extended Holidays:
If December 16 is also a holiday, payment can be made on the next immediate working day, such as December 17, 2024.
Advance Tax Payment Schedule
Online Payment Option
Although the 1994 Circular allows payment on the next working day, it is advisable to pay the advance tax within the stipulated deadlines using online platforms. Online payment portals remain operational even on holidays, reducing the risk of system-driven penalties under Sections 234B and 234C, which might still occur due to automated processes.
Key Takeaway
- Pay by December 15: Use online facilities to ensure timely payments, even on holidays.
- If delayed due to holidays: Payments on the next working day (December 16, 2024) are valid and penalty-free.
- Clarifications: For any discrepancies, consult your assessing officer.
This approach ensures compliance while minimizing unnecessary penalties.
