Interest
Section 234C Interest — Deferment of Advance Tax Installments
Section 234C charges interest at 1% per month for 3 months if advance tax installments are not paid on time — by June 15 (15%), September 15 (45%), December 15 (75%), and March 15 (100%).
Response Deadline
N/A — interest is automatic
Extension
Not available
New IT Act
Section 234C
What Does This Notice Mean?
Even if you paid total advance tax, you are liable for 234C interest if individual installments were not paid by their due dates. The interest is 1% per month for 3 months on the shortfall in each installment.
Common Triggers
- Missing advance tax installment deadlines
- Paying entire advance tax in last installment instead of quarterly
- Shortfall in any quarterly installment
How to Respond
- 1Verify the installment schedule used in computation
- 2Check if the correct percentages are applied (15/45/75/100)
- 3For presumptive taxation (44AD/44ADA), only one installment by March 15 is required
- 4If interest is incorrectly calculated, file rectification under Section 154
Consequences of Non-Compliance
Interest at 1% per month for 3 months on the shortfall amount for each installment period.
Frequently Asked Questions
What are the advance tax installment due dates?
June 15 (15%), September 15 (45%), December 15 (75%), and March 15 (100%) of estimated tax. For presumptive taxation under Section 44AD, only March 15 applies.
Related Sections
Detailed Guides
Received a Section 234C Notice?
Upload your notice PDF and get AI-powered legal analysis with verified case law citations in minutes. Free trial included.
Disclaimer: This content is for informational purposes only and does not constitute legal or tax advice. Always consult a qualified Chartered Accountant or tax professional for advice specific to your situation. AI-generated content should be reviewed by a professional before use.