The Nature of advance tax payment is:

The correct answer is: B. Liability

Advance tax is a liability because it is an amount that a company owes to the government. It is a type of tax that is paid in advance of the actual tax liability being determined. Advance tax is usually paid on a quarterly basis, and it is based on the company’s estimated income for the year.

The other options are incorrect because:

• Assets are resources that a company owns and that have economic value. Advance tax is not an asset because it is not a resource that the company owns.
• Prepaid expenses are expenses that have been paid for in advance, but that have not yet been incurred. Advance tax is not a prepaid expense because it is an expense that is incurred in the current period, even though it is paid in advance.
• Revenue expenditure is an expense that is incurred in the current period and that is directly related to the generation of revenue. Advance tax is not a revenue expenditure because it is not directly related to the generation of revenue.

In conclusion, the nature of advance tax payment is a liability.