The 15 June 2026 advance tax installment is the first installment under the Income-tax Act 2025 for Tax Year 2026-27 income (1 April 2026 to 31 March 2027). You owe it if your tax payable after TDS is Rs 10,000 or more (Act 2025 Sec 404). Salaried earners with FD interest, rental income, or capital gains realised in Q1 are the most common miss case. The nominal target is 15% of estimated total liability, but Sec 425(2) provides a safe-harbor floor at 12% below which deferment interest at 3% kicks in. Pay via the e-pay tax portal, selecting Tax Year 2026-27 (not AY) under Act 2025. Not financial advice.
Quick Facts
| Item | Detail |
|---|---|
| Installment due date | 15 June 2026 |
| Nominal installment % | 15% of estimated total liability |
| Safe-harbor floor (Sec 425(2)) | 12% of tax due on returned income |
| Threshold for advance tax (Sec 404) | Rs 10,000 of tax payable for the year |
| Governing Act | Income-tax Act 2025 (first installment under new Act) |
| Computation section | Sec 405: A = B - C (B = income-tax on the specified sum at rates in force; C = tax deductible or collectible at source during the financial year under any provision of the Act) |
| Shortfall interest (Sec 424) | 1% per month, triggers if advance tax paid < 90% of assessed tax; period starts 1 April 2027 |
| Deferment interest (Sec 425) | 3% on shortfall at 15 June / 15 Sep / 15 Dec; 1% on 15 March shortfall |
| Cess | 4% Health and Education Cess (Finance Act 2026 First Schedule) on (tax + surcharge if applicable) |
| Rounding rule (Sec 516) | Tax payable rounded to nearest Rs 10, ignoring paise |
| Payment portal | incometax.gov.in e-pay tax; select Tax Year 2026-27 |
| Carve-out (Sec 403(3)) | Resident senior citizen with no business or professional income |
Do you owe advance tax in June 2026?
Five-question decision flow.
Q0 (gating). Are you a presumptive taxpayer under Act 2025 Sec 58(2) Table Sl. No. 1 (eligible business; 1961 Sec 44AD legacy) or Sl. No. 3 (specified profession per Sec 62(4); 1961 Sec 44ADA legacy)? If YES, your 15 June installment is Rs 0. You still owe full advance tax, but Sec 408(2) requires payment in one lump sum by 15 March 2027. Skip to "When 15 June does NOT apply" below. Goods-carriage operators (Sec 58(2) Sl. No. 2; 1961 Sec 44AE legacy) follow the regular installment schedule.
Q1. Is your salary TDS sufficient? If your employer is deducting TDS on the full salary using the right regime (new vs old) and Form 12BB declarations, your salary-only liability is covered. Move to Q2 to check other income.
Q2. Do you earn FD interest above your bank's TDS threshold? Banks deduct TDS on FD interest above the bank's threshold under Sec 393 (successor to 1961 Sec 194A); check your bank's TDS notice for the threshold applicable to your account class. If your interest sits below threshold (no bank TDS) or is split across banks below per-bank threshold, you owe the tax yourself. Move to Q3.
Q3. Did you realise capital gains in Q1 (1 April to 30 June 2026)? Listed-equity short-term capital gains are taxed at 20% under Act 2025 Sec 196 (successor to 1961 Sec 111A). Listed-equity LTCG above Rs 1,25,000 per year is taxed at 12.5% under Act 2025 Sec 198 (successor to 1961 Sec 112A). For resident investors selling listed equity on a broker, no broker TDS is withheld on the gain (unlike FD interest), so the entire liability sits with you. NRI sellers, property sellers, and certain platform transactions have separate TDS regimes (Sec 195, Sec 194-IA equivalents) outside this post's scope. Move to Q4.
Q4. Do you have rental income from commercial property, professional fees outside Sec 58 presumptive scope, or any other income with TDS that does not match your slab? If yes, you likely owe.
Compute residual tax payable using Sec 405: A = B - C where B is income tax on the specified sum (including cess) at rates in force in the financial year, and C is tax deductible or collectible at source during the full financial year under any provision of the Act (not only TDS already deducted in the months before the installment due date - estimate the FY-total TDS that will be withheld, including months yet to come). If A is Rs 10,000 or more, you owe advance tax. Use the Income Tax Calculator to estimate B.
💰How to calculate your 15 June installment
Worked example.
Inputs:
- Rs 18 LPA salaried (employer TDS fully covers salary tax liability per Form 16)
- Rs 4,00,000 listed-equity STCG realised 10 May 2026 (before 15 June)
- No FD / rental / other side income
- Total taxable income: Rs 22,00,000 (below Rs 50L surcharge threshold)
Tax on Rs 4L STCG (Act 2025 Sec 196, 20% on listed-equity STCG):
- STCG tax = Rs 4,00,000 × 20% = Rs 80,000
- Surcharge = Rs 0 (total income Rs 22L below Rs 50L threshold)
- Cess (Finance Act 2026, 4% on tax + surcharge) = 4% × Rs 80,000 = Rs 3,200
- Total residual liability = Rs 80,000 + Rs 0 + Rs 3,200 = Rs 83,200
15 June installment:
- Nominal target (15%): 15% × Rs 83,200 = Rs 12,480
- Safe-harbor floor (Sec 425(2), 12%): 12% × Rs 83,200 = Rs 9,984
Pay at least Rs 9,984 by 15 June to avoid Sec 425 deferment interest. Pay the Rs 12,480 target to stay on the nominal schedule. Rs 12,480 is already a multiple of Rs 10 so no Sec 516 rounding step is needed.
The four installments through 15 March 2027
Per Act 2025 Sec 408(1) for non-presumptive assessees:
| Installment | Due date | Cumulative target | Safe-harbor floor (Sec 425(2)) |
|---|---|---|---|
| First | 15 June 2026 | 15% | 12% |
| Second | 15 September 2026 | 45% | 36% |
| Third | 15 December 2026 | 75% | No Sec 425(2) safe-harbor floor (target itself binds) |
| Fourth | 15 March 2027 | 100% | No Sec 425(2) safe-harbor floor (target itself binds) |
Sec 425(2) provides safe-harbor floors only for the first two installments (June at 12% and September at 36%). The December and March nominal targets stand on their own; any shortfall below 75% by 15 December or 100% by 15 March triggers Sec 425 deferment interest at the relevant rate.
Sec 408(3): "Any amount paid by way of advance tax on or before the 31st March, shall be treated as advance tax paid during the financial year ending on that day."
Interest if you miss or underpay
Two separate interest sections apply.
Sec 425 - deferment interest, per installment. Rate: 3% on shortfall at the 15 June / 15 September / 15 December installments; 1% on shortfall at the 15 March installment (Income Tax FAQ Q20).
Three scenarios for the 15 June installment in our worked example (Rs 12,480 nominal / Rs 9,984 safe-harbor floor):
- Scenario A (safe-harbor compliance): Pay Rs 10,000 by 15 June. Above the 12% floor (Rs 9,984), so no Sec 425 interest applies. The remaining liability is owed in subsequent installments per the cumulative schedule.
- Scenario B (below floor): Pay Rs 8,000 by 15 June. Below the 12% floor. Sec 425(1) interest applies on the shortfall from nominal Rs 12,480 target. Shortfall = Rs 12,480 - Rs 8,000 = Rs 4,480. Interest = 3% × Rs 4,480 = Rs 134.40 (settled in the 15 September installment).
- Scenario C (zero payment): Pay Rs 0 by 15 June. Sec 425(1) interest = 3% × Rs 12,480 = Rs 374.40, settled in the 15 September installment.
Sec 425(4) capital-gains exception. If you realise capital gains AFTER an installment due date, Sec 425(4) protects you from Sec 425(1) or (3) deferment interest on that missed installment, provided you pay the tax in full in any remaining advance-tax installment; if no installment remains, by 31 March of the tax year. The exception also covers Sec 2(49)(n) income, first-time business/profession income, and dividend income, not just capital gains.
For example, if the same Rs 4L STCG is realised on 20 June 2026 (instead of 10 May), Sec 425(4) lets you pay the Rs 12,480 (and onward) in the 15 September installment without Sec 425 deferment interest on the missed 15 June installment.
Important caveat: Sec 425(4) protects only from Sec 425 deferment interest. It does NOT exempt you from Sec 424 year-end shortfall interest if your total advance tax paid by year-end is still less than 90% of assessed tax.
Sec 424 - year-end shortfall interest. Triggers if advance tax paid through the year is less than 90% of assessed tax (Income Tax FAQ Q20). Rate: 1% per month or part of a month on the shortfall. Period: from 1 April 2027 (for Tax Year 2026-27) until self-assessment payment date.
Example: Year-end self-assessment for TY 2026-27 shows total advance tax paid was 85% of assessed tax (below 90%). Sec 424 interest applies on the 5% shortfall from 1 April 2027 until you settle the residual at self-assessment.
📋How to pay - e-pay tax portal walkthrough
The e-pay tax portal at incometax.gov.in handles both Acts in parallel during the transition window. Critical UI difference for 2026 (verbatim from Income Tax Department Tax Payments page):
"For self-assessment tax for FY 2025-26 paid in June 2026 - taxpayer will select AY 2026-27. For advance tax on income earned during April 2026 to March 2027 - taxpayer will select Tax Year 2026-27."
Step-by-step for the 15 June 2026 installment:
- Log in at incometax.gov.in (PAN-based login).
- e-Pay Tax, then New Payment.
- Select (100) Advance Tax as the tax payment type.
- Select Tax Year 2026-27 (not Assessment Year 2027-28 - the AY concept is discontinued under Act 2025 for current-year filings).
- Enter the amount (Rs 9,984 safe-harbor floor minimum; Rs 12,480 nominal target in our example).
- Confirm and pay via NetBanking, debit card, or UPI.
- Save the challan (CIN) for your records and ITR cross-check.
Common error: selecting AY 2027-28. The AY field is gone under Act 2025 for TY 2026-27 payments. If you see an AY dropdown for advance tax, you are likely in the 1961-Act-self-assessment flow by mistake; switch to the Act 2025 advance-tax flow.
When 15 June does NOT apply
Two carve-outs.
(a) Resident senior citizen with no business or professional income. Per Act 2025 Sec 403(3), advance tax does not apply to "an individual resident in India who (a) does not have any income chargeable under the head ‘Profits and gains of business or profession’; and (b) is of the age of sixty years or more at any time during the tax year." If you have any business or professional income (44ADA presumptive included), this carve-out does NOT apply.
(b) Presumptive taxpayers under Sec 58(2) Sl. No. 1 or Sl. No. 3. Per Sec 408(2): "An assessee, who declares profits and gains as per the provisions of section 58(2) (Table: Sl. No. 1 or 3), shall pay the whole amount of advance tax on the current income, calculated in the manner laid down in section 405 during each financial year, on or before the 15th March." Sl. No. 1 = eligible business (1961 Sec 44AD legacy); Sl. No. 3 = specified profession per Sec 62(4) (1961 Sec 44ADA legacy). Goods-carriage operators (Sl. No. 2; 1961 Sec 44AE legacy) follow the regular installment schedule under Sec 408(1), not Sec 408(2).
FAQ
1. Is advance tax only for freelancers?
No. Anyone whose tax payable after TDS exceeds Rs 10,000 owes advance tax (Sec 404). This covers salaried earners with FD interest, capital gains, or rental income, not just freelancers.
2. My employer deducts TDS - do I still owe advance tax?
Only if you have other income (FD interest, capital gains, rental income, business income) whose tax is not fully covered by TDS. Salary-only earners with employer TDS matching the right regime usually do not owe.
3. What is the threshold for advance tax?
Rs 10,000 of tax payable for the year (Act 2025 Sec 404).
4. When is the first installment for Tax Year 2026-27 due?
15 June 2026, 15% of estimated total liability.
5. What if I miss the 15 June 2026 deadline?
If you paid at least 12% by 15 June (Sec 425(2) safe-harbor), no deferment interest. Below 12%, Sec 425(1) interest applies at 3% on the shortfall from nominal 15%, settled in the 15 September installment.
6. How is Sec 424 shortfall interest different from Sec 425 deferment interest?
Sec 424 is year-end (1 April onwards), triggered by total advance tax < 90% of assessed tax, 1% per month. Sec 425 is per-installment, 3% on shortfall at 15 June / 15 September / 15 December and 1% on shortfall at 15 March. The 15 June and 15 September installments use Sec 425(2) safe-harbor floors (12% and 36% respectively) below the nominal targets; the 15 December and 15 March installments have no Sec 425(2) safe-harbor floor and use the nominal 75% and 100% targets directly.
7. I realised capital gains after 15 June - do I owe Sec 425 interest on the missed installment?
No. Sec 425(4) protects you from Sec 425(1) or (3) interest on that installment, provided you pay the tax in any remaining advance-tax installment; if no installment remains, by 31 March of the tax year.
8. Do senior citizens have to pay advance tax?
Resident senior citizens (age 60+ at any time during the tax year) with no business or professional income are exempt under Act 2025 Sec 403(3).
9. I am a freelancer on presumptive Sec 58 / 44ADA - do I owe advance tax on 15 June?
No installment on 15 June. Sec 408(2) requires presumptive taxpayers under Sec 58(2) Sl. No. 1 or Sl. No. 3 to pay full annual advance-tax liability by 15 March in one lump sum.
10. Can I pay all my advance tax in March instead of installments?
Non-presumptive taxpayers can technically pay everything by 15 March, but Sec 425 deferment interest accrues on each installment shortfall. Stick to the 15/45/75/100 schedule (with 12% and 36% safe harbors only for June and September) to avoid interest.
11. What Tax Year do I select on the e-pay tax portal?
Tax Year 2026-27, not AY 2027-28. Act 2025 discontinues the AY concept. The portal shows AY 2026-27 only for self-assessment of FY 2025-26 income under the 1961 Act.
12. I paid 13% by 15 June - do I owe Sec 425 interest?
No. Sec 425(2) safe-harbor: pay at least 12% by 15 June, no deferment interest even if the nominal target is 15%.
Sources
- Income-tax Act 2025, Section 196 (STCG on STT-linked listed equity / equity-oriented funds / business trusts at 20%): incometaxindia.gov.in
- Income-tax Act 2025, Section 198 (LTCG above Rs 1,25,000 at 12.5% on STT-linked listed equity etc): incometaxindia.gov.in
- Income-tax Act 2025, Section 403(3) (resident senior citizen carve-out): incometaxindia.gov.in
- Income-tax Act 2025, Section 404 (Rs 10,000 advance tax threshold): incometaxindia.gov.in
- Income-tax Act 2025, Section 405 (computation formula A = B - C): incometaxindia.gov.in
- Income-tax Act 2025, Section 408 (installment schedule + Sec 408(2) presumptive 15 March): incometaxindia.gov.in
- Income-tax Act 2025, Section 424 (shortfall interest 1% pm, < 90% trigger, period from 1 April): incometaxindia.gov.in
- Income-tax Act 2025, Section 425 (deferment interest 3% / 1% + Sec 425(2) safe harbors + Sec 425(4) exceptions): incometaxindia.gov.in
- Income-tax Act 2025, Section 516 (rounding to nearest Rs 10): incometaxindia.gov.in
- Income-tax Act 2025, Section 58 (presumptive taxation + Sec 58(2) Table row labels): incometaxindia.gov.in
- Finance Act 2026, First Schedule (4% Health and Education Cess): indiabudget.gov.in
- Income Tax Department - Tax Payments page (e-Pay tax portal Tax Year 2026-27 selection verbatim): incometax.gov.in/iec/foportal/help/all-topics/e-filing-services/tax-payments
- Income Tax Department - Tax Payments FAQ (Q17, Q19, Q20 on Sec 404 / Sec 408(2) / Sec 424 / Sec 425): incometax.gov.in/iec/foportal/help/all-topics/e-filing-services/tax-payments-faq
- Income Tax Department - Objective and Scope of New Act FAQ (AY concept discontinuation): incometax.gov.in/iec/foportal/help/all-topics/e-filing-services/objective-and-scope-new-act-faq