Sections 209 and 210 of Income-tax Act, 1961: Computation and Payment of Advance Tax
Sections 209 and 210 of the Income-tax Act, 1961 dealt with the computation of advance tax and payment of advance tax by an assessee on his own estimate or pursuant to an order of the Assessing Officer. For current tax years beginning on or after 1 April 2026, the Income-tax Act, 2025 is the governing enactment and the corresponding provisions are principally sections 405, 406 and 407.
Meaning of advance tax
Advance tax is income-tax paid during the financial year in respect of income of that year, instead of waiting until return filing or final assessment. Under the current Income-tax Act, 2025, section 404 provides the basic threshold for liability and section 405 provides the method of computation.
Section 209 of the Income-tax Act, 1961 - Computation of advance tax
Section 209 prescribed how advance tax was computed under the 1961 Act. Broadly, where the assessee calculated advance tax, the assessee estimated current income and applied the rates in force for the financial year. Where computation was made by the Assessing Officer for an order under section 210, the statutory basis specified in section 209 applied.
The tax so calculated was generally reduced by tax deductible or collectible at source on income taken into account in computing the relevant income. The statutory proviso prevented such reduction where income had actually been paid or credited without the required deduction, or received or debited without the required collection, as applicable.
Section 209 also contained rules concerning net agricultural income where the relevant Finance Act required agricultural income to be considered for rate purposes.
Section 210 of the Income-tax Act, 1961 - Payment of advance tax
Section 210 required every person liable to pay advance tax under section 208 to pay advance tax on the due dates specified in section 211, calculated in accordance with section 209. It also allowed an assessee to revise the amount payable in later instalments when the estimate of current income changed.
Order by the Assessing Officer
For a person already assessed by way of regular assessment, section 210(3) authorised the Assessing Officer, subject to the statutory conditions and time limit, to require payment of advance tax by a written order calculated under section 209 and accompanied by a notice of demand under section 156.
Amended order and assessee's estimate
Section 210 also dealt with amendment of the Assessing Officer's order on the basis of a later return or regular assessment. An assessee who considered the amount payable on current income to be lower could intimate the Assessing Officer in the prescribed manner and pay according to the assessee's estimate. If the estimated liability was higher, the assessee was required to pay the higher amount in accordance with the provision.
Current corresponding law under the Income-tax Act, 2025
For tax years governed by the Income-tax Act, 2025, the former scheme has been reorganised and simplified. The current provisions separate computation, voluntary payment and payment pursuant to an Assessing Officer's order.
| Subject | Income-tax Act, 1961 | Income-tax Act, 2025 |
|---|---|---|
| Liability threshold for advance tax | Section 208 | Section 404 |
| Computation of advance tax | Section 209 | Section 405 |
| Payment by assessee on own accord | Section 210 | Section 406 |
| Payment pursuant to Assessing Officer's order | Section 210 | Section 407 |
| Instalments and due dates | Section 211 | Section 408 |
Section 405 of the Income-tax Act, 2025 - Computation of advance tax
Section 405 provides a simplified statutory formula for computing advance tax:
The provision requires income-tax on the relevant specified sum to be calculated at the rates in force for the financial year. The permitted reduction for tax deductible or collectible at source is subject to the conditions stated in section 405. The section also addresses net agricultural income where the relevant Finance Act requires it to be taken into account.
Section 406 of the Income-tax Act, 2025 - Payment by assessee on own accord
Section 406 requires a person liable to advance tax under section 404 to pay advance tax on the specified sum, calculated under section 405, at the appropriate percentage on or before each instalment due date specified in section 408. For this purpose, the specified sum is the current income estimated by the assessee.
The assessee may increase or reduce the amount payable in the remaining instalments to accord with the revised estimate and the resulting advance-tax liability.
Section 407 - Advance tax pursuant to Assessing Officer's order
Section 407 separately contains the current rules governing advance tax required pursuant to an order of the Assessing Officer. This separation is one of the structural changes made by the Income-tax Act, 2025 to simplify the earlier provisions that were combined in section 210 of the 1961 Act.
Advance tax threshold and instalments under current law
Under section 404 of the Income-tax Act, 2025, advance tax is payable where the amount of tax payable during the financial year, computed under the relevant Part, is Rs. 10,000 or more.
| Due date | Cumulative advance tax generally payable |
|---|---|
| On or before 15 June | Not less than 15% |
| On or before 15 September | Not less than 45% |
| On or before 15 December | Not less than 75% |
| On or before 15 March | 100% |
Official references
Income Tax Department - Section 209, Income-tax Act, 1961 Income Tax Department - Section 210, Income-tax Act, 1961 Income Tax Department - Income-tax Act, 2025 Income Tax Department - Section 406, Income-tax Act, 2025
This article is intended as a general legal and tax reference. The applicable provision should be checked with reference to the relevant tax year, Finance Act, rules, notifications and transition provisions.