If you are a freelancer or consultant and nobody deducts enough tax from your income, you pay it yourself in instalments during the year. That is advance tax. For tax year 2026-27 (1 April 2026 to 31 March 2027), the third instalment is due on 15 December 2026, and by then you should have paid 75% of your estimated tax for the year.
This is the first year under the Income-tax Act, 2025, so the section numbers you may know (208, 211, 234B, 234C, 44ADA) have new numbers. The rules themselves are largely the same. We give both, in the form "section 408 (old 211)".
Who has to pay advance tax
- Anyone whose tax for the year, after TDS and TCS, is ₹10,000 or more (section 404, old 208).
- Exception: a resident individual aged 60 or more with no income from business or profession does not have to pay advance tax (section 403(3), old 207). A freelancing senior citizen is not exempt, because freelance fees are professional income.
TDS your clients deduct from your fees counts towards your tax. Advance tax covers only the balance.
The schedule for tax year 2026-27
| Due date | Cumulative tax paid by then | This instalment | Interest if you are short |
|---|---|---|---|
| 15 June 2026 | 15% | 15% | 3% of the shortfall (none if you paid at least 12%) |
| 15 September 2026 | 45% | 30% | 3% of the shortfall (none if you paid at least 36%) |
| 15 December 2026 | 75% | 30% | 3% of the shortfall |
| 15 March 2027 | 100% | 25% | 1% of the shortfall |
The percentages come from section 408(1) (old 211); the interest from section 425 (old 234C). The September and December instalments are the same size, 30% each. December feels bigger only because it is the first deadline after the festive season.
The presumptive option: pay everything by 15 March
If you are in a specified profession and declare income on a presumptive basis under section 58(2), Table serial 3 (old 44ADA), the rules are simpler:
- Your taxable income is deemed to be 50% of gross receipts. You can declare more. Declaring less generally needs books of account and an audit.
- The scheme is available if gross receipts are up to ₹50 lakh, or up to ₹75 lakh if cash receipts are no more than 5% of the total.
- "Specified profession" is defined in section 62(4): legal, medical, engineering, architectural, accountancy, technical consultancy, interior decoration, information technology and company secretary, plus any others CBDT notifies. Freelance developers and IT consultants may qualify under "information technology".
- Under section 408(2), presumptive filers (also small businesses under the old 44AD) pay 100% of their advance tax by 15 March 2027. There are no June, September or December instalments.
So if you use the presumptive scheme, 15 December 2026 is not a deadline for you. The only interest risk is 1% on anything unpaid at 15 March. Many freelancers miss this and pay quarterly anyway, which is allowed but not required.
Worked example 1: Meera, presumptive filer
Illustrative example. Meera is a design consultant who uses the presumptive scheme and the new tax regime.
- Invoices: April–June ₹3 lakh, July–September ₹8 lakh, October–December ₹9 lakh, January–March ₹5 lakh. Gross receipts ₹25 lakh, all by bank transfer.
- Presumptive income at 50%: ₹12.5 lakh. Add FD interest of ₹75,000. Total income: ₹13.25 lakh.
| New-regime slab | Income in slab | Tax |
|---|---|---|
| Up to ₹4 lakh at 0% | ₹4,00,000 | ₹0 |
| ₹4–8 lakh at 5% | ₹4,00,000 | ₹20,000 |
| ₹8–12 lakh at 10% | ₹4,00,000 | ₹40,000 |
| ₹12–16 lakh at 15% | ₹1,25,000 | ₹18,750 |
| Tax before cess | ₹78,750 | |
| Add 4% cess | ₹3,150 | |
| Total tax | ₹81,900 | |
No rebate applies, because the rebate (section 156, old 87A) covers total income only up to ₹12 lakh. Marginal relief does not help either: her income is ₹1.25 lakh above ₹12 lakh, and that is more than the ₹78,750 tax.
What Meera owes on 15 December 2026: nothing. As a presumptive filer she can pay the full ₹81,900 by 15 March 2027 with no interest.
If she did not use the presumptive scheme and paid nothing until 15 March, the schedule would apply. Assume, for comparison, the same tax of ₹81,900 (in reality her income would be worked out from her books, so the tax would differ). Her cumulative dues would be ₹12,285 by 15 June (15%), ₹36,855 by 15 September (45%) and ₹61,425 by 15 December (75%). Interest under section 425 would be:
3% × (₹12,285 + ₹36,855 + ₹61,425) = 3% × ₹1,10,565 = ₹3,317.
That is the real cost, and it is simple interest. It does not compound.
Worked example 2: salary plus freelance income
Illustrative example. Arjun earns a ₹15 lakh salary and ₹8 lakh of freelance profit (from his books, not presumptive). He uses the new regime.
- Salary after the ₹75,000 standard deduction: ₹14.25 lakh. His employer's TDS, worked out on salary alone: ₹93,750 + 4% cess = ₹97,500.
- Total income: ₹14.25 lakh + ₹8 lakh = ₹22.25 lakh.
- Tax on ₹22.25 lakh: ₹20,000 + ₹40,000 + ₹60,000 + ₹80,000 + 25% of ₹2.25 lakh (₹56,250) = ₹2,56,250. Add 4% cess: ₹2,66,500.
- Advance tax due after TDS: ₹2,66,500 − ₹97,500 = ₹1,69,000.
| Due date | Cumulative % | Cumulative amount |
|---|---|---|
| 15 June 2026 | 15% | ₹25,350 |
| 15 September 2026 | 45% | ₹76,050 |
| 15 December 2026 | 75% | ₹1,26,750 |
| 15 March 2027 | 100% | ₹1,69,000 |
An alternative some salaried freelancers use is asking the employer to deduct more TDS. Instalments are worked out on your tax after TDS, so extra TDS shrinks what you need to pay at each date. Run your own numbers in the tax saving calculator, and check whether the old regime suits you better using our old vs new regime comparison.
What a missed December instalment actually costs
Say you are ₹1.5 lakh short on 15 December 2026.
- Section 425 (old 234C): 3% × ₹1,50,000 = ₹4,500. If you catch up by 15 March 2027, that is the whole cost.
- If you still have not paid by 15 March: another 1% on the March shortfall, ₹1,500.
- Section 424 (old 234B): if the advance tax you paid is below 90% of your final tax, simple interest of 1% a month runs from 1 April 2027 until you pay. Paid when you file on 31 August 2027, that is 5 months × 1% × ₹1,50,000 = ₹7,500.
Worst case: ₹4,500 + ₹1,500 + ₹7,500 = about ₹13,500. If you catch up in March: ₹4,500. Both are worth avoiding, but neither is the five-figure disaster some guides suggest.
If you already missed June or September this year, pay the catch-up now. The interest already charged on those dates will not go away. But paying the full 75% by 15 December stops the December shortfall interest.
Capital gains and one-off income
If you sell shares or mutual funds during the year, the tax on the gain is part of your advance tax. Under section 425(4), you are not charged deferment interest for earlier instalments on capital gains you could not have foreseen, provided you pay the tax on them in the remaining instalments (or by 31 March if the gain arises after 15 March). Our mutual fund tax guide covers the gain rates. Traders should also read the F&O and intraday tax guide.
How to pay
- On the income tax e-filing portal, open e-Pay Tax (log in with PAN, or use the no-login option).
- Select Income Tax Act 2025. This is the option for payments relating to tax year 2026-27 onwards. The "Income Tax Act 1961" option is for assessment year 2026-27 and earlier, so do not pick it for this year's advance tax.
- Choose tax year 2026-27 and the payment type Advance Tax (Minor Head 100).
- Pay by net banking, UPI, card or at the bank, and keep the challan receipt (it shows the CIN).
- Check the payment appears in your annual tax statement (Form 168, formerly 26AS) and in AIS a few days later.
Picking the wrong Act, year or payment type is an easy challan mistake to make and a slow one to fix, so check before you pay.
Filing the return
For tax year 2026-27, returns are due on:
- 31 July 2027 for individuals without business or professional income;
- 31 August 2027 for non-audited business or professional income, including presumptive filers;
- 31 October 2027 for audited cases.
Interest under section 424 keeps running until you pay, so do not wait for the due date if you know you are short. For a broader year-end routine, see the year-end tax planning checklist, and estimate your liability with the tax saving calculator before each instalment.
Quick checklist for 15 December 2026
- Estimate full-year income, including the January–March quarter.
- Subtract TDS already deducted (check AIS and Form 168).
- Presumptive filer? Nothing is due in December; plan for 100% by 15 March 2027.
- Otherwise, pay enough to reach 75% of the year's tax.
- Pay under the Income Tax Act 2025, tax year 2026-27, Minor Head 100.
The examples are illustrative and use new-regime rates for tax year 2026-27. This is general information, not tax advice.