The e-payment mode of income tax was introduced by the Income Tax (IT) department for payment of direct taxes online by taxpayers. With this, the taxpayers can now choose from two modes of payment for income tax-

  1. The physical mode of payment i.e., payment made by presenting the hard copy of the IT challan at the authorized bank. This mode is traditional and has been prevalent since a long time in India.
  2. E-payment mode i.e., making payment using net-banking facility with any of the authorized banks.

 

MANDATORY e-PAYMENT:

A few taxpayers are not permitted to use the physical mode of tax payment, instead they can only pay taxes through the e-payment method. Taxpayers that are classified under this category are:

  • All companies.
  • All non-corporate taxpayers who are liable to get their books of accounts audited under Section 44AB of the Income Tax Act.

Any individual or company who does not fall in the mandatory category can opt to voluntarily pay their taxes through the e-payment facility. It is always advisable to choose the e-payment method since it saves both time and efforts. Also, it is very convenient.

Requirements for Making E-payment

In order to pay taxes through the e-payment mode, the taxpayer needs to possess a net banking enabled bank account with an authorized bank. In case the assessee (taxpayer) does not have a net banking enabled account, the taxpayer can make the e-payment through an account of another person, provided, the tax should be paid in their own name.

Benefits of Making E-payment of Income Tax

  • E-payment of income tax is very time saving, simple and secure. It can be done any time from anywhere.
  • The amount will be instantly paid from your respective bank account.
  • You can enquire whether the Income Tax Department has received the tax amount paid on their official website of the IT Department.
  • The details of the e-challan will be sent to the Income Tax Department directly. The bank would not have to go through any sort of data entry.
  • A receipt for tax payment is issued immediately when the income tax amount is paid from the online bank account.

Nature of Challan That Needs to Be Used

CHALLAN NO. NATURE OF TAX PAYMENT
ITNS 280 For making payment of income tax and corporate tax (i.e. income tax by companies)
ITNS 281 For making payment of TDS/TCS by corporate and non-corporate deductors or collectors
ITNS 282 For making payment of Securities Transaction Tax, Wealth Tax and other direct taxes
ITNS 283 For making payment of Banking Cash Transaction Tax and Fringe Benefits Tax.
ITNS 284 For making payment of income tax and corporate tax in case of undisclosed foreign income and assets
ITNS 285 For making payment of equalization levy
ITNS 286 For making payment under Income Declaration Scheme, 2016
ITNS 287 For making payment under the Pradhan Mantri Garib Kalyan Yojana, 2016 (PMGKY)
Form No. 26QB For making payment of tax deducted at source in case of immovable property
Form No. 26QC For making payment of tax deducted at source in case of rent of property

Source: incometaxindia.gov.in/tutorials/3%20e-payment%20of%20direct%20taxes.pdf

 

PROCEDURE FOR PAYMENT OF IT ONLINE:

Step 1: Login to the NSDL-TIN website www.tin-nsdl.com

Step 2: Head to Services and click on ‘e-payment: Pay Taxes Online’

Step 3: Select the relevant challan, which in case of income tax payment, is ITNS 280.

Step 4: You will be redirected to a page requiring the following data:

    • Permanent Account Number
    • Assessment Year
    • Address details of taxpayer
    • Type of Payment
    • Mode of Payment

Step 5: After you finish entering all the necessary details, click on the ‘Proceed’ button. A confirmation screen will be seen.

Step 6: After verifying entered details, click on the Submit button, which will redirect you to the online banking page of the chosen bank.

Step 7: On the online banking platform page, fill in your user ID and password for online/ net banking and proceed to enter payment details at the bank site.

Step 8: After the payment is completed, a confirmation receipt will be displayed on the bank website. The acknowledgement you will receive after the payment will contain the Challan Identification Number, payment details and bank name used to make the payment.

 

Points to Be Checked While Making E-Payment of Income Tax

The Challan 280 needs to be filled mandatorily for making E-payment of income tax and corporate tax also. Below are some of the points that need to be kept in mind while providing details in Challan 280:

The assessee(taxpayer) should correctly select the applicable tax with the correct code of respective tax. The codes provided in Challan 280 are:

  • 0020 – Applicable for the income tax paid by companies
  • 0021 – Applicable for the income tax paid by non-corporate taxpayers

The assessee should correctly select the applicable mode of payment with the correct code of respective mode of payment. The codes under different mode of payment provided in Challan 280 are:

  • 100 – Applicable for payment of advance tax
  • 300 – Applicable for payment of self-assessment tax
  • 400 – Applicable for tax on regular assessment
  • 106 – Applicable for tax on distributed profit
  • 107 – Applicable for tax on distributed income
  • 102 – Applicable for surtax