1What is the difference between 234A, 234B and 234C?
234A is interest for late filing; 234B for paying less than 90% of advance tax by year-end; 234C for missing the advance-tax instalment dates. All charge interest, typically 1% a month.
Home -> Articles
ArticleIf you file late or fall short on advance tax, the income tax law charges interest under three related sections. Knowing what each covers helps you avoid them. Here's 234A, 234B and 234C explained.
Reviewed by CA Harika Chebolu, FCA · Last updated 2026-06-13
Quick answer
These sections charge 1%-a-month interest for late filing, unpaid advance tax, and deferred instalments. Here's what each covers.
Section 234A charges interest, typically 1% a month, on any unpaid tax when you file your return after the due date. It runs from the due date until you file, so the longer you delay a return with tax outstanding, the more it costs — on top of the late fee.
Section 234B applies when you were liable to pay advance tax (tax over Rs 10,000) but paid less than 90% of it by year-end. It charges interest, typically 1% a month, on the shortfall from the start of the assessment year until you pay.
Section 234C charges interest, typically 1% a month, when you miss or underpay the individual advance-tax instalments (due 15 June, 15 September, 15 December and 15 March). Even if you pay the full amount by year-end, paying instalments late within the year attracts 234C.
File on time to avoid 234A; estimate your tax and pay advance tax across the four instalments to avoid 234B and 234C. The presumptive-scheme taxpayers have a simplified single-instalment option for 234C. Paying on schedule is the whole solution.
At 1% a month, the interest is modest per month but compounds over time and across all three sections. For someone with significant non-salary income who ignores advance tax, it can become a meaningful, entirely avoidable cost.
234A is interest for late filing; 234B for paying less than 90% of advance tax by year-end; 234C for missing the advance-tax instalment dates. All charge interest, typically 1% a month.
Estimate your tax and pay advance tax across the four instalments (15 June, 15 Sep, 15 Dec, 15 March). 234B covers the year-end shortfall; 234C covers missed instalments.
Typically 1% a month on the unpaid or short amount — modest monthly but it compounds over time and across the three sections, so it adds up if ignored.
Worried about advance-tax interest? Write to the firm and we'll plan your instalments so 234B/234C never apply.