Advance Tax for Traders (2026): Dates, Math and Penalties
Note: This is general information, not tax advice, and tax rules change. Verify the current figures against the Income Tax Act, the relevant Finance Act and ICAI guidance, and confirm your own position with a qualified Chartered Accountant.
Who has to pay
Advance tax applies if your total tax for the year after TDS is โน10,000 or more. For most profitable traders, it applies. Because there is no TDS on trading profit, you cannot rely on anything being withheld for you; the estimating and paying is entirely your job.
The four installments
Lay out your own numbers, including the interest if you are behind, with the advance tax calculator.
234C: the per-installment penalty
Section 234C charges 1% per month on the shortfall against each installment deadline, for three months on the first three installments and one month on the last. Underpay the June installment and you carry 3% on that shortfall by the time you catch up. It is small per installment but adds up across a year of under-paying.
234B: the year-end penalty
Section 234B is separate. If you paid less than 90% of your assessed tax by the end of the financial year, it charges 1% per month from 1 April of the assessment year until you pay. On a large unpaid liability this runs for months and becomes the bigger cost of the two.
The hard part: estimating a moving target
Trading profit is volatile, so your full-year estimate keeps changing. The practical approach is to revise at each installment from your year-to-date position rather than guessing once in June. That only works if you have an accurate running profit figure across all your brokers.
How to never miss one
Aktai Tax keeps a live liability estimate from your imported trades and sends a WhatsApp or Telegram reminder seven days and one day before each date, with the amount due. It is the same alert pipe behind Aktai's trading alerts. More on the advance tax tracker.
Frequently asked questions
Do traders need to pay advance tax?
Yes, if your total tax liability after TDS is โน10,000 or more in the year. F&O and intraday profits have no TDS, so the full responsibility to estimate and pay sits with you across four installments.
What are the advance tax dates?
Cumulatively: 15% by 15 June, 45% by 15 September, 75% by 15 December and 100% by 15 March. Traders using the 44AD presumptive scheme pay the whole amount in one installment by 15 March.
How much interest do I pay for missing advance tax?
Section 234C charges 1% per month on shortfalls against each installment. Section 234B charges a further 1% per month from 1 April of the assessment year if under 90% of the tax was paid by year end. They stack.