When Income Tax Assessing Officer is liable to determine the Advance tax liability?
- If a Income taxpayer who has a legal obligation to pay advance tax fails to make payment for advance tax or advance tax is lower than the correct amount Assessing Officer may pass an order asking the taxpayer to pay tax on assessee’s current year income
- Such order shall clearly specify the advance tax amount payable and in number of instalments the same needs to be paid
- Such AO order should be passed anytime during the previous year but before 1st March, i.e., by 28th February
Computation by the Assessing Officer
- Income Tax Assessing Officer can serve an order requiring the assesse to pay advance tax if he is of the opinion that such person is liable to pay advance tax or the tax paid is lower
- In such cases, the Income tax officer will take the higher of following incomes and calculate the tax as per prevailing rate of income-tax:-
- (a) The total income of the latest previous year in respect of which officer has assessed income, i.e., the year for which an assessment has been completed by the Income-tax Officer,
- (b) The total income declared by the assesse in any return after the year of assessment by Income tax officer., i.e., Any income furnished by the assessee in Income tax return for any previous year after
Section 210 of income tax act define in- Payment of advance tax by the assessee of his own accord or in pursuance of order of Assessing Officer
Sub Section (1) of this section Every person who is liable to pay advance tax under section 208 of Income Tax Act 1961 (whether or not he has been previously assessed by way of (RA) regular assessment) shall, of his own accord, pay, on or before each of the due dates specified in section 211, the appropriate percentage, specified in that section, of the advance tax on his current income, calculated in the manner laid down in section 209 of Income tax Act.
Sub Section (2) of this section A person who pays any instalment or instalments of advance tax under sub-section (1), may increase or reduce the amount of advance tax payable in the remaining Advance tax instalment or instalments to accord with his estimate of his current income and the advance tax payable thereon, and make payment of the said amount in the remaining instalment or instalments accordingly.
Sub Section (3) of this section In the case of a person who has been already assessed by way of regular assessment in respect of the total income of any previous year, the Assessing Officer, if he is of opinion that such person is liable to pay advance tax, may, at any time during the financial year but not later than the last day of February, by order in writing, require such person to pay advance tax calculated in the manner laid down in section 209 of Income Tax Act, and issue to such person a notice of demand under section 156 of income tax act specifying the instalment or instalments in which such tax is to be paid.
Sub Section (4) of this section) If, after the making of an order by the Assessing Officer under sub-section (3) and at any time before the 1st day of March, a return of income is furnished by the assessee under section 139 of income tax act or in response to a notice under sub-section (1) of section 142 of this act, or a regular assessment of the assessee is made in respect of a previous year later than that referred to in sub-section (3), the Assessing Officer may make an amended order and issue to such assessee a notice of demand under section 156 ot this act requiring the assessee to pay, on or before the due date or each of the due dates specified in section 211 of this act falling after the date of the amended order, the appropriate percentage, specified in section 211 of this act, of the advance tax computed on the basis of the total income declared in Income tax return or in respect of which the regular assessment aforesaid has been made.
Sub Section (5) of this section A person who is served with an order of the Income Tax Assessing Officer under sub-section (3) or an amended order under sub-section (4) may, if in his estimation the advance tax payable on his current year income would be less than the amount of the advance tax specified in such order or amended order, send an intimation in the prescribed form to the Income tax Assessing Officer to that effect and pay such advance tax as accords with his estimate, calculated in the manner laid down in section 209, at the appropriate percentage thereof specified in section 211 of Income tax act, on or before the due date or each of the due dates specified in section 211 of this act falling after the date of such intimation.
Sub Section (6) of this section A person who is served with an order of the Income tax Assessing Officer under sub-section (3) or amended order under sub-section (4) shall, if in his estimation the advance tax payable on his current year income would exceed the amount of advance tax specified in such order or amended order or intimated by him under sub-section (5), pay on or before the due date of the last installment specified in section 211 of this act, the appropriate part or, as the case may be, the whole of such higher amount of advance tax as accords with his estimate, calculated in the manner laid down in section 209 of this act.
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