If you can help it, pay your tax online

Last updated: 25 May 2021

Sub Heading : The process obviates a visit to the CA and the long queues at the bank and the tax office

Content : Online filing of income tax appears to have caught on since the shift from Saral to the Indian Income Tax Return (ITR) forms happened a couple of years ago. Online tax payment and filing have already been made mandatory for companies and sooner than later, individual filings too would be moved online.
With the July 31 tax-returns deadline coming up right ahead, it may be time to go over the nitty-gritty of the process once more, just so that one doesn't lose sight of the vital points.
The benefits
Online tax payment saves one the bother of queuing up at a bank branch to pay tax and collecting the challan.
It also reduces the paperwork involved.
Also, the tax-payment challan can be readied from the comfort of one's home or office. This is a huge leap in convenience from the situation earlier when one literally had to take a day off work to be able to pay tax, for bank branches would open around the time one left for office and close before one could get out.
The National Securities Depository Ltd (NSDL) has made available an online tax payment facility — https:tin.tin.nsdl.cometaxIndex.html — to customers of as many as 29 banks, a list of which is available on the website. NSDL has been constantly adding banks to the list to bring the entire country under this loop.
Paying tax online
The taxpayer will have to first select and fill the relevant challan. There are four different challans for different taxes — challan 280 (ITNS 280) for corporation tax, income tax and wealth tax, challan 281 for tax deducted at source (TDS) challan 282 for interest tax, gift tax, and challan 283 for fringe benefit tax.
One would need to key in the permanent account number (PAN) or tax deduction and collection account number (TAN), as the case may be, on the specific challan. PAN is needed for non-TDS payments and TAN for TDS payments.
Other personal details would be asked for only when the PAN or TAN has been confirmed.
After all the details have been submitted, including the name of the bank where the taxpayer has a netbanking account, the website would ask for a final confirmation on the information provided. One could also make changes if any at this stage and resubmit the form.
Once the personal details have been confirmed, the website will direct the user to the selected bank's website. Here one would need to furnish the login customer ID and password granted to him by the bank, and the amount to be paid.
Upon a successful transaction, the website would display a receipt. This is a counterfoil containing the details required by one for filing income tax returns.
Ideally, one should take a printout of this page as it would not be made available later. Alternatively, one should make a note of the challan identification number (CIN), amount of tax paid and other details, for proof.
There is no need, however, to attach this challan with the ITR form — the CIN is enough.
It usually takes about a week for the challan to be actually credited. One can check the status of the challan on the same website.
One could also check the debit transactions in his statement of accounts to be sure the payment has been made.
One could run the process through the bank's website, too. If the bank is already partnering NSDL for online tax payment, it itself would lead you to the NSDL site.
But, beware of emails claiming 'free tax payment'. Don't follow the link to those websites. Instead, type the bank's web address and look for the 'Pay tax' option. Once the tax payment is made, it is time to file the tax return.
Filing returns
The ITR forms, eight in all, are also available online. Assesses can use the form applicable to them as per the assessment year they wish to file returns for.
An assessment year is the year when the income earned is assessed or taken into account. For example, the income earned in 2007-08 is assessed in 2008-09, which is the assessment year.
The tax-filing process is completely online for only those who possess digital signature. These signatures are valid for one to two years and cost between Rs 500 and Rs 2,000, which may be an expensive proposition for many.
Those who wish to fill ITR forms electronically and submit them without digital signatures will need to fill ITR-V. Salaried employees would have most of the information required in the Form 16 issued to them by their employers.
One needs to fill the form applicable, duly mentioning the CIN generated at the end of the online tax payment.
In case of ITR-V, though the form is submitted to the income tax department online, there is no digital signature. Hence, one still needs to take a printout, sign and submit at the relevant income tax office.


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