Advance Tax Due Date on June 15, Sunday: Can advance tax be paid Monday, i.e., after the due date, without penalty?
Advance Tax Due Date on June 15, Sunday: Can advance tax be paid Monday, i.e., after the due date, without penalty?
Advance Tax is required to be paid by taxpayers whose income tax liability exceeds Rs 10,000 in four installments. The first installment’s due date of the advance tax for the FY 2025-26 is on June 15, 2025. This means that you have only one day left to pay the tax. Taxpayers must note that it is Sunday on June 15, 2025, and all banks are closed on this day. Therefore, you will not be able to pay the advance tax using a bank challan or physical NEFT/IMPS on Sunday, June 15, 2025.
Additionally, the second Saturday is falling on the day before Sunday, i.e, June 14, 2025. Therefore, banks will be closed on Saturday, June 14, 2025. Due to these bank holidays, many taxpayers might be wondering if they can make their payment on the next working day, which is Monday, June 16, 2025, without having to pay any late fees or interest.
The answer is yes, you can pay your advance tax on June 16, 2025, without having to pay any penalty or interest. This is because June 14 (Saturday) and June 15 (Sunday) are holidays. But this decision can be challenged by the tax department. There is an old circular issued in 1994, which is still valid. As per the circular, if the due date falls on a public holiday, then the payment can be made on the next working day.
The Income Department in a circular dated January 14, 1994, clarified that if a tax due date for making payments of installments falls on a holiday, then the assessee can make the payment on the next working day, like Monday. In such cases, the mandatory interest leviable under sections 234B and 234C of the Income Tax Act, 1961, would not be charged.
However, the rules have changed over time. Now, all companies and taxpayers who are required to be audited must pay their taxes, including advance tax, online only. So while the holiday rule still applies, the payment must be made electronically. An expert explains that unless the tax is paid through NEFT/RTGS by physically visiting the bank, the rule that allows payment on the next working day may not always be applicable. The revenue authorities can still impose interest for making the advance tax payment after the due date, especially when the taxpayer is a company or a person who is subject to auditing.
As per a tax professional, based on the Circular no. 676 dated January 14, 1994, a taxpayer can pay the first installment of the advance tax for FY 2025-26 on June 16, 2025 (Monday) without being penalised, as it is Saturday on June 15, 2025. However, the tax department might contend that electronic payment options are available 24/7. As a result, they could still charge interest for a one-day delay.
Taxpayers must note that the circular is very old, and nowadays we have the option of online payment. Therefore, there could still be chances of being penalised under sections 234B and 234C. Taxpayers are advised to ask the assessing officers to ensure clarity and avoid any issues in future.