Section 408 of the Income-tax Act, 2025 requires advance tax in four instalments: not less than 15% by 15 June, 45% by 15 September, 75% by 15 December and the whole amount by 15 March. Presumptive taxpayers under section 58(2) pay the whole amount by 15 March.
What section 408 does
Section 408 sets the advance tax calendar — the successor to section 211 of the Income-tax Act, 1961. The percentages and dates are unchanged, and they are now laid out in a three-column table rather than in running text.
The instalments are cumulative, not incremental. The 15 September instalment is 45% of the total advance tax as reduced by what was already paid, and so on. A shortfall in an early instalment therefore has to be made good in the next one, not carried quietly forward.
Two special rules matter. Presumptive taxpayers under section 58(2) (Table serial 1 or 3) pay the whole amount by 15 March in a single instalment. And under sub-section (3), anything paid on or before 31 March is treated as advance tax paid during that financial year for all purposes of the Act.
The Income-tax Act, 2025 takes effect from 1 April 2026 and applies from tax year 2026-27. The Income-tax Act, 1961 continues to govern every year up to 31 March 2026, including assessments, appeals and penalties for those years, because of the repeal and savings provision in section 536. Figures quoted here are the amounts written into the Act as enacted (with the Gazette corrigenda of 3 September 2025); the annual Finance Act can change rates and thresholds.
Old Act and new Act, side by side
The table below shows what the Income-tax Act, 1961 did and where the same ground is covered in the Income-tax Act, 2025.
| Income-tax Act, 1961 | What it did | Income-tax Act, 2025 |
|---|---|---|
| 211(1) | Four instalments with cumulative percentages | 408(1) |
| 211(1), proviso | Presumptive taxpayers pay in one instalment by 15 March | 408(2) |
| 211(2) | Payment by 31 March treated as advance tax | 408(3) |
| 207 | Liability for advance tax | 403 |
| 208 | Conditions of liability | 404 |
| 209 | Computation of advance tax | 405 |
| 234C | Interest for deferment | 425 |
Section 408 sub-section by sub-section
Read this alongside the bare text — each heading below is a sub-section of the section as enacted.
Sub-section (1) — the four instalments
Every assessee liable to advance tax, other than those in sub-section (2), pays on the current income computed under section 405 in four instalments during each financial year, on the due dates and in the amounts in the table. Each instalment is expressed as a cumulative percentage as reduced by amounts already paid in earlier instalments.
Sub-section (2) — presumptive taxpayers pay once
An assessee who declares profits and gains under section 58(2) (Table serial 1 or 3) pays the whole amount of advance tax on the current income, computed under section 405, on or before 15 March. There are no June, September or December instalments for them.
Sub-section (3) — the 31 March grace
Any amount paid by way of advance tax on or before 31 March is treated as advance tax paid during the financial year ending on that day for all the purposes of this Act. This matters for computing interest under sections 424 and 425 — a payment on 30 March still counts as advance tax, though it does not undo the interest already triggered by missing 15 March.
How it links to interest
Missing these dates has two separate consequences. Section 425 (the old section 234C) charges interest for deferment — that is, for missing an instalment date. Section 424 (the old section 234B) charges interest where the total advance tax paid is less than 90% of assessed tax. Both can apply in the same year.
The section 408 instalment table, as enacted
| Sl. No. | Due date of instalment | Amount payable |
|---|---|---|
| 1. | On or before the 15th June. | Not less than 15% of such advance tax. |
| 2. | On or before the 15th September. | Not less than 45% of such advance tax, as reduced by the amount, if any, paid in the earlier instalment. |
| 3. | On or before the 15th December. | Not less than 75% of such advance tax, as reduced by the amount or amounts, if any, paid in the earlier instalment or instalments. |
| 4. | On or before the 15th March. | The whole amount of such advance tax, as reduced by the amount or amounts, if any, paid in the earlier instalment or instalments. |
Worked example
A business estimates its advance tax liability for tax year 2026-27 at ₹8,00,000.
| Due date | Cumulative requirement | Amount to pay | If paid |
|---|---|---|---|
| 15 June 2026 | Not less than 15% = ₹1,20,000 | ₹1,20,000 | ₹1,20,000 — on time |
| 15 September 2026 | Not less than 45% = ₹3,60,000, less ₹1,20,000 paid | ₹2,40,000 | ₹1,40,000 — short by ₹1,00,000 |
| 15 December 2026 | Not less than 75% = ₹6,00,000, less ₹2,60,000 paid | ₹3,40,000 | ₹3,40,000 |
| 15 March 2027 | 100% = ₹8,00,000, less ₹6,00,000 paid | ₹2,00,000 | ₹2,00,000 |
The September shortfall attracts interest under section 425 even though the full ₹8,00,000 was paid by 15 March. However, section 425(2) provides a tolerance: no interest arises if at least 36% of the tax due on returned income was paid by 15 September — here only 32.5% was, so the shortfall bites.
A professional taxed under section 58(2) with the same ₹8,00,000 liability would pay nothing in June, September or December and the entire ₹8,00,000 by 15 March 2027, under sub-section (2).
Compliance checklist and due dates
- Diarise 15 June, 15 September, 15 December and 15 March and compute each instalment on a cumulative basis.
- Presumptive taxpayers under section 58(2) (Table serial 1 or 3) need only the 15 March payment.
- Use the tolerance limits in section 425(2) — 12% by 15 June and 36% by 15 September — when estimating early instalments.
- Aim for at least 90% of assessed tax by 31 March to avoid interest under section 424.
- Remember that a payment on or before 31 March still counts as advance tax under sub-section (3).
- Reduce advance tax by tax deducted or collected at source, as section 405 requires.
- Capital gains and first-time business income are given relief from section 425 interest — see section 425(4).
Common mistakes
- Treating the percentages as incremental (15%, 30%, 30%, 25%) instead of cumulative (15%, 45%, 75%, 100%).
- Assuming that paying the full amount by 15 March avoids all interest. Section 425 charges for deferment of earlier instalments.
- Applying the four-instalment schedule to a presumptive taxpayer, who pays once by 15 March.
- Forgetting that section 424 tests the total against 90% of assessed tax, a separate test from the instalment dates.
- Ignoring the 12% and 36% tolerances in section 425(2) when planning the first two instalments.
This is an explanatory guide, not tax advice, and it does not reproduce the section in full. Read the bare text of the section before you rely on it, and check for later amendments, the Income-tax Rules made under the new Act, and CBDT circulars and notifications.
Related Guides
- Section 425 — interest for deferment of advance tax
- Section 424 — interest for default in advance tax
- Chapter XIX — collection and recovery of tax
- Income-tax Act 1961 vs 2025 — master comparison
- Section mapping cheat sheet: 1961 to 2025
Key Facts About Section 408 of Income
- Applies in: All states across India, under the relevant central law.
- Mode: Mostly online via the official government portal.
- Typical timeline: Ranges from a few days to a few weeks depending on the case.
- Non-compliance: May attract penalties, interest or late fees.
- Expert help: TaxClue completes the entire process end to end for you.
What are the advance tax due dates under the Income-tax Act, 2025?
15 June for not less than 15%, 15 September for 45%, 15 December for 75% and 15 March for the whole amount, each reduced by amounts already paid — section 408(1).
Which section replaces section 211?
Section 408 of the Income-tax Act, 2025 — instalments of advance tax and due dates.
Over 90% of compliance penalties in India arise from missed due dates — timely handling can save businesses thousands of rupees each year.
Section 408 of Income: a key compliance topic in Indian tax and corporate law that businesses and individuals must understand to remain compliant.