Deduction or collection at source and advance payment
[Section-390 as per the Income Tax Act, 2025 (this Act) w.e.f. 1st April, 2026.]
Section 390(1) of Income Tax Act 2025
390(1) The tax on income shall be payable as per this Chapter by way of––
- 390(1)(a) deduction or collection at source; or
- 390(1)(b) advance payment; or
- 390(1)(c) payment under section 392(2)(a).
Section 390(2) of Income Tax Act 2025
390(2) The tax referred to in sub-section (1) shall be payable as per the provisions of this Chapter, irrespective of the assessment to be made later than the relevant tax year.
Section 390(3) of Income Tax Act 2025
390(3) Nothing contained in this section, shall affect the charge of tax on such income under section 4(1).
Section 390(4) of Income Tax Act 2025
390(4) The payment of tax referred to in sub-section (1) shall be in addition to any other mode of tax collection to discharge the liability in respect of income assessed for a tax year.
Section 390(5) of Income Tax Act 2025
390(5) The tax deducted or collected at source or sum referred to in section 392(2)(a) under this Chapter and paid to the Central Government shall be treated as payment of tax on behalf of the person––
- 390(5)(a) from or in respect of whose income or payment, such tax has been deducted or paid; or
- 390(5)(b) from whom such tax has been collected.
Section 390(6) of Income Tax Act 2025
390(6) The Board may make rules for—
- 390(6)(a) giving credit of tax deducted or collected or paid to a person referred to in sub-section (5) and also a person other than the person referred to in the said sub-section;
- 390(6)(b) the tax year for which the credit shall be given.
FAQs on Section 390 of Income Tax Act 2025
What are the modes of tax payment under Section 390(1) of the Income Tax Act, 2025?
Tax on income shall be payable by way of (a) deduction or collection at source; or (b) advance payment; or (c) payment under section 392(2)(a).
Is the payment of tax under Section 390 dependent on assessment of income?
No, according to Section 390(2), tax shall be payable as per this Chapter irrespective of whether the income is assessed later for the relevant tax year.
Does Section 390 override the basic charge of tax under Section 4(1)?
No, as per Section 390(3), nothing in Section 390 affects the charge of tax on income under Section 4(1).
Does the tax paid under Section 390 replace other forms of tax collection?
No, as stated in Section 390(4), tax payment under this section is in addition to any other mode of tax collection to discharge tax liability for the tax year.
How is tax deducted or collected at source treated?
Section 390(5) clarifies that tax deducted or collected at source or the sum paid under section 392(2)(a) shall be treated as payment of tax on behalf of the person from or in respect of whose income the tax is deducted or collected, or from whom it is collected.
Who gets credit for tax deducted, collected or paid under this Chapter?
Under Section 390(6), rules may be made by the Board for credit to (a) the person referred in sub-section (5), and (b) any other person not mentioned therein.
For which tax year will the credit of tax be allowed?
Section 390(6)(b) allows the Board to make rules specifying the tax year for which credit of tax will be given.
Can the same income be taxed under Section 4(1) and also be subject to deduction or advance payment under Section 390?
Yes, since Section 390 does not affect the tax charge under Section 4(1), both provisions operate concurrently.
Is there any obligation to pay tax in advance if tax has already been deducted at source?
Yes, Section 390(4) implies that deduction or collection at source is in addition to other modes, so advance tax may still be required depending on the total tax liability.
Does Section 390(5) allow for third-party tax payments on behalf of another person?
Yes, it allows the deducted or collected amount to be treated as payment of tax on behalf of the person from whose income or payment it was deducted or collected.
Can a person other than the one mentioned in Section 390(5) claim credit for tax deducted or collected?
Yes, Section 390(6)(a) permits rules to be made to give credit to persons other than those directly referred to in Section 390(5).
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