Section 210 of ITA, 1961 : Section 210: Payment Of Advance Tax By The Assessee Of His Own Accord Or In Pursuance Of Order Of Assessing Officer

Explanation using Example

Let's say Ravi, a freelance software developer, expects to earn significant income during the financial year 2022-23. He knows that his income will exceed the threshold limit and he will be liable to pay income tax. Aware of the provisions of the Income-tax Act, 1961, Ravi decides to calculate his advance tax liability on his own accord as per Section 208. He estimates his income and, following Section 209, calculates the advance tax he needs to pay.

Now, as per Section 210(1), Ravi must pay the calculated advance tax in instalments as specified in Section 211, before the due dates. If during the year Ravi realizes that his income is higher than he initially estimated, he can, according to Section 210(2), increase the amount of his remaining advance tax instalments to match his new estimate.

Conversely, if Ravi receives a notice from the Assessing Officer under Section 210(3), demanding advance tax based on a regular assessment from a previous year, Ravi must comply and pay the specified amount. However, if Ravi believes that his current income will be lower than what the Assessing Officer estimated, he can, as per Section 210(5), send an intimation in the prescribed form to the Assessing Officer with his own estimate and pay the advance tax accordingly.

If Ravi's actual earnings for the year end up being even higher than his revised estimate, he must, according to Section 210(6), pay the difference in the advance tax by the due date of the last instalment. This ensures that Ravi pays the correct amount of tax on his current income and avoids any interest or penalty for underpayment of advance tax.