Advance Tax Due 15 September 2026: 45% Instalment, Section 408 & Payment Guide

Last reviewed: 14 September 2026.

Answer first: The second instalment of advance tax for Tax Year 2026-27 is due on 15 September 2026. Under section 408 of the Income-tax Act, 2025, most assessees liable to advance tax should have paid a cumulative amount of at least 45% of their estimated advance-tax liability by this date, after reducing the amount already paid in the June instalment.

The Income Tax Department's current tax calendar also lists 15 September 2026 as the due date for the second instalment of advance tax for Tax Year 2026-27.

15 September 2026 advance tax at a glance

Who needs to pay advance tax?

Advance tax is a pay-as-you-earn mechanism. The practical starting point is to estimate the tax on current-year income after considering applicable tax rates, surcharge and cess where relevant, and then reduce eligible tax credits such as TDS/TCS and other amounts permitted in the computation.

If the resulting advance-tax liability is payable under the Act, the taxpayer should follow the statutory instalment schedule. The exact liability can differ by taxpayer type and by the nature of income, so a business owner, professional, salaried person with substantial non-salary income, investor with capital gains and company should not assume the same computation merely because the due date is common.

How the 45% rule works

Section 408 states that by 15 September a regular assessee should have paid not less than 45% of the advance tax, reduced by the amount already paid in the earlier instalment.

Example: Suppose the estimated advance-tax liability for Tax Year 2026-27 is ₹2,00,000. The cumulative target by 15 September is ₹90,000. If ₹30,000 was already paid by 15 June, the additional amount required to reach the 45% cumulative level is ₹60,000, subject to any change in the revised current-income estimate.

Advance tax schedule under section 408

Presumptive taxation needs a separate check

Section 408 contains a separate rule for the assessee covered by the specified presumptive-profit provisions referenced in section 58(2). Such an assessee pays the whole advance-tax amount on or before 15 March rather than following the four-instalment schedule. Do not automatically apply the September 45% rule to a taxpayer using an eligible presumptive scheme without checking the current-law conditions.

How to estimate the 15 September payment

1. Estimate total income for Tax Year 2026-27 using actual income up to date plus a reasonable forecast for the rest of the year.
2. Include business/professional income, salary, interest, rent, capital gains and other taxable income as applicable.
3. Apply the tax regime and rates that legally apply to the taxpayer.
4. Compute tax, surcharge and cess where relevant.
5. Reduce available TDS/TCS and other eligible credits used in the advance-tax computation.
6. Determine the estimated advance-tax liability.
7. Calculate 45% of that amount.
8. Reduce advance tax already paid in the June instalment.
9. Pay the balance by 15 September 2026.

Capital gains and unpredictable income

Capital gains, dividend, one-time business receipts and other unpredictable income can make an earlier estimate obsolete. A taxpayer should therefore recompute current income before every instalment. If a major taxable receipt arises after an earlier instalment, the later instalment should reflect the revised estimate rather than mechanically repeating the original projection.

What if the September instalment is short?

Short-payment or deferment can create interest consequences under the applicable provisions. The Income Tax Department's transition guidance states that the policy for advance-tax payment has not changed merely because the Income-tax Act, 2025 introduced the Tax Year concept. The Department also confirms that the quarterly dates and cumulative percentages remain 15%, 45%, 75% and 100%.

Because interest consequences can depend on the amount and timing of the shortfall and the nature/timing of income, calculate the position using the current Act and, for material amounts, reconcile it with your tax computation rather than relying on a generic percentage alone.

Payment checklist for finance teams

• Reconcile the latest trial balance or management accounts.
• Update projected profit for the full tax year.
• Reconcile TDS/TCS credits and major receivables.
• Capture capital gains and exceptional income separately.
• Review disallowances, depreciation and year-end adjustments that materially affect taxable income.
• Document the tax estimate and assumptions used.
• Verify the PAN/entity and tax-payment details before payment.
• Save the challan/payment acknowledgement and map it in the tax ledger.
• Schedule a December recomputation rather than treating September as final.

Old Act vs new Act: what changed?

For Tax Year 2026-27, the Income-tax Act, 2025 is in force. The Department's transition FAQs say there is no policy change in the advance-tax instalment pattern: the principal change is that the liability is referenced to the Tax Year. Section 405 provides the computation framework and section 408 sets out the instalments and due dates.

Official sources

• Income Tax Department tax calendar
• Income Tax Department

This article is an educational compliance guide. For a material tax position, use the enacted law, current portal instructions and facts of the taxpayer.

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