CFOSurge India/Owner questions/Tax & cash

Advance tax keeps catching you short? Plan it like a salary, not a surprise.

A 3-minute check to see how ready you are for the next instalment. The full guide is underneath.

The problem

Advance tax dates arrive and the cash isn't there, so you borrow or pay interest.

The way out

Estimate from this year's numbers, set aside monthly, subtract TDS, and forecast each instalment.

The way out, step by step

Four steps to stress-free advance tax

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★Every instalment funded in advance
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The full guide

Everything behind your answer, in detail

Read only the sections you need. Each one stands on its own.

Prepared by the CFOSurge India CFO team

The answer in brief

Businesses whose tax for the year crosses the threshold must pay it in advance during the year, in instalments due by 15 June, 15 September, 15 December and 15 March, with interest for shortfalls and delays. Businesses under the presumptive scheme generally pay in one instalment by 15 March. The cash crunch comes from estimating the year's profit too late and not setting money aside. Estimate profit every quarter from the MIS, set aside tax monthly in a separate account, and put each instalment in the 13-week forecast.

On this page
  1. Questions first
  2. How it works
  3. Your low point
  4. Estimate
  5. Six industry cases
  6. What to do now
  7. Every quarter
  8. Mistakes to avoid
  9. Official sources
  10. Key terms
  11. Questions owners also ask
Stage 1 · Notice

Answer these questions before you read on

Commit to an answer before you open each one. Together they show where the problem is.

1What will your profit for this year be? Can you say today?

Advance tax depends on an estimate you have to make in June.

2Where is the money for the December instalment right now?

If it's in your CC limit, the instalment will be borrowed.

3Did you pay interest for short payment last year?

Interest is the price of estimating late.

4Do you know which instalments are cumulative?

Each due date is a share of the full year's tax, not a quarter of it.

5Is your CA involved before each instalment, or only at the return?

Planning has to happen before the dates, not after the year.

Advance tax isn't extra tax. It's this year's tax, paid on a schedule you know in advance.

Stage 2 · Understand

How advance tax works for a business

Due byCumulative share of the year's tax (most businesses)
15 June15%
15 September45%
15 December75%
15 March100%

As the schedule stands at our last review. Businesses under the presumptive taxation scheme generally pay in one instalment by 15 March. Thresholds, interest and exceptions are set by the Income-tax Act, 2025; confirm the current position with your CA.

Stage 3 · Locate

See where the instalments hit your cash

Find your cash low pointExample figures · replace with yours
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Stage 4 · Verify

Estimate the year's tax properly

  1. Use the latest MIS, not last year's return.
  2. Project the rest of the year from the order book and budget.
  3. Adjust for depreciation, disallowances and deductions with your CA.
  4. Subtract TDS deducted by customers (check 26AS).
  5. Recalculate before every instalment.
Stage 5 · Compare

Six businesses, six versions of the same problem

The same problem looks different in every industry. Pick the business closest to yours:

These are composite businesses with illustrative figures, built to show how the method works. They are not CFOSurge client results.

Hover over a business for a preview (tap on a phone), then click to open the full case.

Stage 6 · Act

Set it aside like a salary

  • Open a separate tax account.
  • Move a fixed share of profit every month.
  • Put each instalment in the 13-week forecast.
  • Review the estimate with your CA two weeks before each date.
Instalment due in two weeks and no cash set aside? Pay what you can on time; interest on a small shortfall is far cheaper than a large one. Then set a monthly transfer.
Stage 7 · Prevent

A quarterly tax routine

  1. Close the quarter's books on time.
  2. Update the profit estimate.
  3. Recalculate the instalment.
  4. Check the tax account balance.
  5. Pay before the due date.
Stage 8 · Avoid

Mistakes to avoid

  • Estimating from last year's profit.
  • Paying from the CC.
  • Ignoring TDS credits in the estimate.
  • Leaving everything to March.
  • Not reviewing with your CA before each date.
Reference

Official sources and guidance

Rules, rates and thresholds change. Check the current position at these official sources before acting.

Reference

Key terms in plain English

3 terms
Advance tax
Income tax paid in instalments during the year in which income is earned.
Presumptive taxation
A simplified scheme where income is taken as a set share of turnover for eligible small businesses.
Form 26AS
The statement of tax credits, including TDS deducted on your behalf.
Reference

Questions owners also ask

When is advance tax due for a business?

As the schedule stands, by 15 June, 15 September, 15 December and 15 March, as cumulative shares of the year's tax. Presumptive-scheme businesses generally pay by 15 March. Confirm current rules with your CA.

What if I underpay an instalment?

Interest is charged on shortfalls and delays. Paying what you can on time keeps it small.

Does the new Income-tax Act change advance tax?

The Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026. Check the current provisions and section references with your CA.

Want a CFO to work through this with you?

If you'd like advance tax estimated and planned every quarter, A CFOSurge CFO can go through it with you using your actual numbers.

  • Plans from ₹50,000 a month, fixed after a free assessment
  • Free consultation with a senior CFO
  • No cost, no obligation
  • Pay nothing if you don't see value in the first 2 weeks

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CFOSurge India · General information only. It isn't financial, tax or legal advice for your circumstances. Worked examples use illustrative figures. · Follow us on YouTube · LinkedIn