benefit of not paying advance tax

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  1. vpssk

    vpssk New Member

    I am a senior citizen and I know that I am not required to pay advance tax. Since 2012, I have always been paying my income tax in the month of July.
    During 2015-206, 5% of my total income was from teaching (professional income) as guest faculty in a university which I received in the month of March. I was not aware that for this income I should pay tax before 31st March. I thought, as usual I shall pay income tax in July.

    95% income was from pension/interest on fixed deposit. I did not pay any advance tax and I plan to pay it by 31st July.
    I know that I have to pay income tax on 5% of my professional income with interest for late payment. ( U/s 234B or 234B and 234C also??)
    My query is do I also need to pay interest (234B, or 234B & 234C) on entire 95% of the income for not paying advance tax?

    Shall appreciate a quick reply as the last date for paying taxes is approaching near.
  2. ZED

    ZED Well-Known Member

    Advance tax provisions are applicable because you do have income from the head Profit and Gain from business and profession.

    Advance tax will be applicable on ALL income and hence provision of S.234 B and 234C will also apply on all income.
    You will know about the interest amount when you will enter the details in ITR utility.

    207. (1) Tax shall be payable in advance during any financial year, in accordance with the provisions of sections 208 to 219 (both inclusive), in respect of the total income of the assessee which would be chargeable to tax for the assessment year immediately following that financial year, such income being hereafter in this Chapter referred to as "current income".

    (2) The provisions of sub-section (1) shall not apply to an individual resident in India, who—

    (a) does not have any income chargeable under the head "Profits and gains of business or profession"; and

    (b) is of the age of sixty years or more at any time during the previous year.
  3. vpssk

    vpssk New Member

    Hello, I find it very illogical that suppose I get paid Rs.100/- by giving a lecture in university and rest of my income is from pension, the whole amount is treated as professional income and I don't get the benefit of not paying my income tax before 31st March? There must be some rule that if professional income exceeds some % of your total income, then you lose the benefit given to senior citizen. Because of such stupid rule, I have been unnecessarily penalized to pay interest of large amount on the entire income.
  4. ZED

    ZED Well-Known Member


    If an assessee has income from business or profession then benefit of not paying advance tax is not provided.

    On an income of mere Rs.100 there shall be no TDS.
    Instead you can show it as honorarium which can be considered under the head of Income from other sources.

    Fees is taken for providing a service. Honorarium is not for any services rendered on request and authorization to do work or as per agreement .Honorarium is not mutually decided.

    If Tax is deducted u/s 194J , you will have to show it as income from profession.

    "There must be some rule that if professional income exceeds some % of your total income, then you lose the benefit given to senior citizen."

    None which I ever came across.

    "Because of such stupid rule, I have been unnecessarily penalized to pay interest of large amount on the entire income."

    It has been held by the courts that ignorance of law is not an excuse.
  5. vpssk

    vpssk New Member

    Another thing is how can one know in advance for sure that the retired person will get some work. In my case, I did not know that I will some work in March, so how can one pay advance tax in June, sept, Dec and March?
  6. vpssk

    vpssk New Member

    I was giving an example of Rs.100 but the fact is only 5% of my income is from giving lectures and university has deducted 10% and I am supposed to pay remaining tax, about which I have no objection. No objection on paying interest even on this amount which I received in March.
    I have objection to paying interest on entire tax U/s 234B and 234C, which is not logical.
  7. ZED

    ZED Well-Known Member

    Hello Ma'am please calm down. You are starting to scare me now. (Already afraid to know that I am talking to a teacher)

    If the amount of interest is really significant then you have one option.
    Since this is a genuine case and there is undue hardship then interest can be waived off, You will have to approach Chief Commissioner of Income Tax or Director-General .

    Order : [F.No. 400/129/2002-IT(B)], dated 26-6-2006.
    (c) Where any income chargeable to income-tax under any head of income, other than "Capital gains" is received or accrues after the due date of payment of the first or subsequent instalments of advance tax which was neither anticipated nor was in the contemplation of the assessee and the advance tax on such income is paid in the remaining instalment or instalments and the Chief Commissioner or Director-General is satisfied on the facts and circumstances of the case that this is a fit case for reduction or waiver of interest chargeable under section 234C of the Income-tax Act.
  8. vpssk

    vpssk New Member

    Thanks Prateek for your replies. Don't you think that it is illogical not to give the benefit (which is otherwise available) just because a very small portion is a professional income?
    It seems that there is no option but to pay interest under 234B and 234C which I will pay and then represent my case to the Chief Commissioner for refund.
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