Advanced Income Tax Calculator

Advance Income Tax Calculator: How to Use It and What Rules Apply (FY 2025-26)

Advance Income Tax is a system where taxpayer pay their Income Tax during the financial year itself instead of paying the entire amount at the end. It works on the principle of pay as you earn and helps reduce the burden of a large tax payment at year end. For FY 2025-26 (Assessment Year 2026-27), understanding advance tax rules is especially important become of changes in the New Tax Regime, rebates, and deductions.

Who Needs to Pay Advance Tax?

Any individual professional, or business owner whose total tax liability for year exceeds ₹10,000 is required to pay Advance Tax. This applies to salaried employees, freelancers, professionals and businesses. However senior citizen (60 years or above) who do not have business or professional income are exempt from paying advance tax.

Even salaried employees may need to pay Advance Tax if their employer does not deduct sufficient TDS or if they have additional income such as interest, capital gains, or rental income.

Choosing the Correct Tax Regime

For FY 2025-26, the New Tax Regime is the default option. Taxpayers can still opt for the Old Tax Regime, but those with business income must file from 10 IEA to do so.

Under the New Tax Regime.

• Standard detection for salary or person income is ₹75,000.
• There is no standard deduction for business income. Business income is calculated after deduction actual business expenses.
• Most deductions like Section 80C, HRA and Section 24(b) not allowed.

Standard Detection and Rebate Explain Clearly

A common area confusion is the difference between deductions and rebates.

• Standard deduction:
• For salaried individuals and pensioners ₹75000 is deducted directly from the gross salary, regardless of income level.
• For business income, there is no fixed standard deduction like ₹60000. Only actual business expenses are allowed.
• Rebate under Section 87A:
• This is not a deduction from income. It is a rebate from the calculated tax.
• Under the New Tax Regime for FY 2025-26, the maximum rebate is ₹60000 for resident individuals whose taxable income does not exceed by ₹12lakh.
• If your taxable income is up to ₹12lakh your final tax after rebate become zero.
• For salaried individuals, become of the ₹75000 standard detection a gross income up to ₹12.75lakh can effectively be tax free.
• If taxable income exceeds by 12lakh no rebate under Section 87A is available, even partially.

How Advance Tax is Calculated.

Ones total in annual tax liability is calculated (after slabs, surcharge if applicable, rebate and 4% Health and Education Cess), advance tax is paid in four installments.

• 15% by 15 June
• 45% by 15 September
• 75% by 15 December
• 100% by 15 March

If advance tax is not paid correctly or on time, interest may be charged under section 234B and 234C.

How an Advance Income Tax Calculator Helps?

In advanced income tax calculator simplifies this entire process. By entering salary income, business income, deductions regime choice and residential status, the calculator automatically: 

• Applies the correct standard direction
• Calculates slab-wise tax
• Applies repeat under Section 87A correctly
• Add cess and surcharge if applicable
• Breaks total tax into quarterly advance tax installment

This has taxpayers plan cash flow, avoid penalties and stay compliant.

Advance income tax is not something a fear. When understanding promptly it become a helpful tool for better financial planning. With the new tax resume of ring the higher rate and standard detection for salary income many tax fear can be legally reducing the tax burden. Using an accurate advance tax calculation and being installment on time in your peace of mind and avoid necessary interest and notice for the tax department.