Advanced Tax Payment for Extra Income Salaried Employees


Bangalore: Tax fever has is something that salaried people have always feared hence making important to pay attention to Advanced Taxes reports Subhash Lakhotia of Master Your Money.

Paying special heed to Advanced Taxes is crucial for all people, especially salaried ones. Salaried people are relatively unfamiliar with the term ‘advanced taxes’ because all their taxes are deducted at source i.e. their employer. Advanced taxes are applicable to a person only if one has more than one source of income and is a salaried employee as well.This tax needs to be paid separately by a person with additional income, excluding the ones deducted at source by the employer. A salaried person need not worry about the taxes deducted at source as the employer takes care of this segment. One with additional income, however, needs special attention.

Section 208 of the Income Tax Act, 1961, provides for advanced taxes. It says that all tax-payers have to pay these additional taxes in the concerned financial year. This, however, is applicable only to those people who fall under a certain bracket. Only people with additional incomes are liable under this section. Additional sources of income include – income gained from additional businesses, short term capital gain, income interests and income from rent.