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Online Payment of Income Tax


Online Payment of Income Tax

Income tax payments can be remitted by means of using an online or offline mode. The facility of online payment of income tax eliminates the complexities of carrying out manual payments. In this article, we briefly discuss the procedure for online payment of income tax.

Mandatory Online Payment of Income Tax

Online payment of income tax is being adopted extensively by the Income Tax department in order so as to ensure that certain categories of taxpayers are prohibited from making manual income tax payments. The requirement for mandatory online payment of tax applies to companies, as well as other taxpayers who are required to get their accounts audited. Individual taxpayers who are not covered by tax audit cases shall be permitted to make deposits of income-tax according to their choice of preference, i.e., through online or offline mode.

Latest Update on the Pay Later Option for Income Tax Filing

The Income Tax e-filing portal has recently rolled out a ‘Pay Later’ option, allowing you to complete your tax filing process before making any tax payments. You can pay taxes after you are done filing. For additional information, please refer to our guide Pay later option for the Income tax return filing.

Benefits of Online Payment

The method of online payment facilitates the taxpayer to save valuable time, and remit the taxes in a manner that is easy and simple. Some of the other benefits of making an online payment of tax are the following:

  • Challan details are directly addressed to the income-tax department, thereby sparing the banks from making data entry.
  • The copies of challan and receipt can be downloaded and maintained for future references.
  • Taxpayers can make enquiries on the status of their transaction.
  • Online payment is secured with Secure Socket Layer (SSL), which ensures the safety of transactions.

Prerequisites for Online Payment

Online payment of income tax can be completed with a net-banking facility. Taxpayers not using net-banking can make their payments using the net-banking enabled account of another person, provided the tax is remitted in the name of the concerned taxpayer.

Eligible Taxes for Online Payment

The following taxes can be remitted through electronic means:

  • Income-tax
  • Equalization levy
  • Corporate tax
  • Tax deducted at source (TDS)
  • Tax collected at source (TCS)
  • Securities Transaction Tax (STT)
  • Wealth-tax
  • Other forms of direct taxes such as gift tax, expenditure tax, and so on.

Online Income Tax Payment Procedure

Online payment of taxes can be pursued in compliance with the procedures specified below:

Step 1:- Official Website

Visit the official e-payment website of the Income Tax Department.

Step 2:- Challan

Choose the appropriate challan.

Step 3:- Specification of Details

In the following page, fill in the required details.

Step 4:- Chose Your Bank  

Now, choose the bank through which you wish to avail this facility.

Step 5:- Verification Code

Enter the verification code that is depicted on the screen, and click on “Proceed.”

Step 6:- Submission of Challan

You will be taken to a page where your details are displayed. If you find the details correct and up-to-date, click on the “Submit to bank” button to process the remittance of tax.

Step 7:- Specification of Details

You will now be required to log in to the account and enter details of total indebted tax, interest, cess, penalty, and other details.

Step 8:- Submission

Click on the “Submit” button to effect the payment.

The above step concludes the payment process. You will be receiving a challan for the payments remitted, which may be maintained as part of the records for future requirements.

Default in Payments

Failure to remit the taxes within the due date would incur interest at the rate of 1% for each month or part of the month of delay. For the awareness of taxpayers, it is informed that taxes must be remitted by the end of the financial year, i.e., on the 31st March of the particular financial year.