For Businesses, Advance Tax is not just about estimating profit—it's about strategic planning to set off available tax credits and avoid locking up working capital. Poor credit utilization can lead to unnecessary outflows and interest penalties. As the IT gears up for more automation and AI-driven scrutiny in 2025, efficient credit planning is no longer optional—it's essential.
| Change / Feature | Impact on Setoff Planning |
|---|---|
| AIS Integration with Pre-filled Returns | Real-time visibility of all credits including TDS/TCS/Dividend Tax Credit |
| New FTC Disclosure Format (for MNCs) | Separate tracking needed for eligible foreign credits |
| MAT Credit Carry forward Tracker Enabled | Track unutilized MAT from past years in new utility |
| TCS under Section 206C(1H) expanded | Increased credits available from B2B collections – now auto-reflected |
| GST-TDS cross-validation (experimental) | Pilot testing to auto-match GST TDS with I-T return for large entities |
| Credit Type | Source | Available (₹) | Used in Q1/Q2 (₹) | Balance (₹) |
|---|---|---|---|---|
| TDS on Professional Receipts | Clients / 26AS | 1,20,000 | 70,000 | 50,000 |
| TCS on Sales Receipts | 206C(1H) Compliance | 40,000 | 0 | 40,000 |
| MAT Credit | From FY 2021-22 | 60,000 | 60,000 | 0 |
| Foreign Tax Credit (FTC) | Branch Income – Singapore | 90,000 | 50,000 | 40,000 |
| Total Credit Available | 3,10,000 | 1,80,000 | 1,30,000 |
Plan quarterly payments after accounting for available balance to avoid interest under Sec. 234B/C
Reconcile 26AS and AIS before each due date Maintain TCS and MAT credit schedules as per latest format Claim FTC in Form 67 within filing deadlines Avoid duplication of credits (esp. TDS and TCS on same transaction) Track refund trends—frequent refunds signal overpayment or poor credit planningEfficient tax credit planning means paying only what's necessary and not a rupee more. As digital compliance tightens in 2025, use every available credit proactively and validate in real-time.
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