Advance Tax on 15 December 2026: The 75% Instalment, New Act

By Tuesday, 15 December 2026, at least 75% of your advance tax for the current year should be paid. This is the third instalment for Tax Year 2026-27, the year that runs from 1 April 2026 to 31 March 2027 and the first year taxed under the Income-tax Act, 2025 (see which law applies to which year).

The instalments in June and September 2026 were the first ones paid under the new Act, so if you paid them, little changes in December. What has changed is the vocabulary: the year is a "Tax Year", not an assessment year, and the interest for paying late now sits in sections 424 and 425 of the new Act instead of sections 234B and 234C of the 1961 Act.

Who has to pay advance tax

You pay advance tax when your tax for the year, after TDS and TCS, is expected to be ₹10,000 or more. In practice that means:

• Freelancers, consultants and business owners, whose income has no TDS or too little.
• Salaried people with other income: rent, interest, capital gains, F&O profits or foreign income that the employer's TDS doesn't cover.
• Investors who sold shares, mutual funds or property during the year at a gain.

Two exceptions carry over from the old law:

• Resident senior citizens (60 or older) with no business or professional income don't have to pay advance tax; they pay the balance as self-assessment tax before filing.
• People on presumptive taxation (the schemes formerly in sections 44AD and 44ADA) can pay the whole amount in one instalment by 15 March 2027.

The four instalments for Tax Year 2026-27

The percentages are cumulative. By 15 December the total of all three instalments, not the December payment alone, should reach 75% of what you expect to owe for the year.

Worked example: what missing December costs

Meera is a consultant who keeps regular books (not presumptive). In October 2026 she estimates her tax for Tax Year 2026-27 at ₹2,80,000. Clients have deducted ₹40,000 of TDS, so her advance tax for the year is ₹2,40,000.

If she skips December and catches up in March, interest for deferring the December instalment works out to ₹72,000 × 1% × 3 months = ₹2,160. That is the same calculation the old section 234C used, and the ITR utility computes it for you when you file in 2027. Paying ₹72,000 by 15 December avoids it.

The second interest charge applies if, by 31 March 2027, you have paid less than 90% of the tax finally assessed. Interest under section 424 (the old 234B) then runs at 1% a month on the shortfall from 1 April 2027 until you pay. If Meera paid nothing after September, she would owe interest under both sections.

A gain that arrives late in the year

Arjun is salaried and his employer's TDS covers his salary. In November 2026 he sells shares at a gain, and the tax on that gain is about ₹1,20,000. Under the old section 234C there was no interest for the June and September instalments on a capital gain that arose after them, as long as the tax went into the instalments still remaining. Arjun should pay 75% of the tax on the gain by 15 December and the rest by 15 March. When he files in 2027, he should check that the return applies the same relief under section 425 before accepting the interest figure.

How to pay the December instalment

Advance tax is paid through e-Pay Tax on the e-filing portal, before or after login.

1. Open e-Pay Tax from Quick Links, or log in and go to e-File > e-Pay Tax.
2. Click New Payment and choose the Income Tax tile.
3. Choose the year. For income earned between 1 April 2026 and 31 March 2027, that is Tax Year 2026-27. Under the old naming this would have been AY 2027-28, and choosing AY 2026-27 by mistake puts the money against last year.
4. Choose type of payment Advance Tax (100).
5. Enter the amount, choose a payment mode (net banking, debit card, payment gateway including UPI and credit card, RTGS/NEFT, or over the counter at an authorised bank) and generate the challan (CRN).
6. Pay. The CRN stays valid for 15 days, so generate it a few days before 15 December, not after.
7. Download the challan receipt from Payment History. Keep the BSR code, challan serial number and date; you will enter them in your return in 2027.

If you picked the wrong year or minor head, act quickly: the portal's Services > Challan Correction service changes the year only within 7 days of the deposit, and the minor head within 30 days. Our post on the challan correction service explains how. For more on the year labels the portal now uses, see AY 2026-27 or Tax Year 2026-27.

Re-estimating in December

December is a good point to redo the estimate. Add income you know about (salary to date, interest credited, rent received, gains booked), project the rest to March, and apply your regime's slabs. If you have overpaid, you'll get the excess back as a refund with interest after filing. If you have underpaid, a top-up now costs less than interest later.

If your affairs are complicated, with business income, foreign income or large one-off gains, a CA can run the estimate with you.

myutils.me lists the tax deposits recorded against each PAN, including advance tax and self-assessment tax, after you add the PAN or press Sync. That lets you check that a December challan shows against the right year for you or a family member. It is an independent app that reads the portal; payments are made on the portal.

FAQ

What percentage of advance tax is due by 15 December 2026?

75% of your estimated advance tax for Tax Year 2026-27, counting the June and September instalments.

Is 15 December 2026 the first advance tax date under the new Act?

No. The new Act applies from 1 April 2026, so the 15 June and 15 September 2026 instalments were already under it. 15 December is the third instalment for Tax Year 2026-27.

What interest applies if I miss the December instalment?

Interest under section 425 of the Income-tax Act, 2025, which replaces section 234C. On the December shortfall it works out at 1% a month for three months.

Do salaried employees need to pay advance tax?

Only if tax on income outside salary, after any TDS, comes to ₹10,000 or more for the year. Rent, interest, capital gains and F&O profits are the usual reasons.

Which year do I choose on the challan?

Tax Year 2026-27 for income earned from April 2026 to March 2027. AY 2026-27 is last year's income under the old Act.

Sources

• Finance Bill, 2026: Part III of the First Schedule (advance tax rates for Tax Year 2026-27 under Chapter XIX-C) and notes on clauses 81 and 82 (sections 424 and 425) (indiabudget.gov.in)
• Memorandum explaining the Finance Bill, 2026 (indiabudget.gov.in)
• e-Pay Tax FAQs, Income Tax e-Filing portal
• Challan correction request user manual, Income Tax e-Filing portal
• Section 424, Income-tax Act, 2025 (incometaxindia.gov.in)
• Section 425, Income-tax Act, 2025 (incometaxindia.gov.in)