Paying advance tax: ITNS 280N challan and instalment dates for tax year 2026-27

Who must pay advance tax?

Any taxpayer whose estimated tax for the year, after TDS and TCS credit, is ₹10,000 or more must pay advance tax. That covers almost every profitable company, firm and LLP, and individuals with business, capital gains or other income not fully covered by TDS. Resident senior citizens aged 60 or above with no business or professional income are exempt.

Under the Income-tax Act 2025, the provisions sit in sections 403 to 408, with the ₹10,000 threshold in section 404. The rules are substantively the same as under the 1961 Act.

Instalment dates for tax year 2026-27

Taxpayers under presumptive schemes for small businesses and professionals pay the entire amount by 15 March. Companies should revisit their estimate before each instalment, because profits often change materially during the year.

Interest for short or late payment

Two interest charges apply. If advance tax paid by 31 March is less than 90% of assessed tax, interest at 1% a month runs on the shortfall from 1 April until payment (section 234B of the 1961 Act). Separately, if an instalment falls short of the required percentage, interest at 1% a month applies on the shortfall, for three months for the first three instalments and one month for the last (section 234C of the old Act).

Interest on deferment is waived for small shortfalls caused by capital gains or other income that could not be estimated earlier, if the tax is paid in the remaining instalments. Commentaries confirm that rates and the threshold are unchanged under the 2025 Act.

Paying with ITNS 280N

From 1 April 2026, the e-Pay Tax service offers new challans under the Income-tax Act 2025. ITNS 280N is used for advance tax, self-assessment tax, tax on regular assessment and certain fees. Select major head 0020 for companies or 0021 for others, minor head 100 for advance tax, and tax year 2026-27. A separate challan is needed for each minor head.

For tax relating to AY 2026-27 or earlier, such as self-assessment tax on FY 2025-26 income paid in 2026, select the Income-tax Act 1961 option and the old ITNS 280. Each payment generates a Challan Reference Number, and the challan receipt shows the BSR code and serial number needed in your return.

Common errors and consequences

Common mistakes include choosing the wrong tax year or Act, selecting minor head 300 (self-assessment) instead of 100, paying under the wrong PAN, and choosing the non-company head for a company. Wrong challans can be corrected through the portal or the assessing officer within limits, but it takes time and may delay credit.

Missing instalments increases interest and can draw attention when the return is processed. Track estimates quarterly with your accountant. Refogo's partner professionals can compute advance tax as part of accounting or return filing services.

Step by step

1. 1Estimate annual income

   Project the year's taxable income and tax, less expected TDS and TCS.

2. 2Open e-Pay Tax

   Log in to the e-filing portal, go to e-File, e-Pay Tax and choose Income Tax Act 2025.

3. 3Select challan details

   Choose tax year 2026-27, major head and minor head 100 for advance tax.

4. 4Enter the amount

   Enter tax, surcharge and cess; interest and penalty are usually nil.

5. 5Pay and save

   Pay by net banking, UPI, card or through a bank, and save the challan receipt.