Simplifying Tax for C.A's and Taxpayers
Electronic payment or E-payment of Income Tax is Mandatory

Electronic payment or E-payment of Income Tax is Mandatory

How income taxes are paid? Taxpayer has not to waste time in long queues at the banks for paying their taxes, just login to internet banking and pay and relax, so simple.

Central board of direct taxes (CBDT) has made it compulsory for some assessee to pay their income tax through e payment mode only i.e. through internet banking facility. All Companies and persons whose accounts are required to get audited u/s 44AB are required to pay taxes electronically using the e-payment facility.

E-payment of taxes are mandatory for all the companies and those persons whose books of accounts are compulsorily required to be audited u/s 44AB (most commonly referred to as tax audit) of Income tax act, 1961. Such taxpayers cannot pay their taxes through physical mode. Other taxpayers can pay their taxes either through e-payment mode or through physical mode. However it is recommended that e payment mode is the best mode for payment for a computer known person and only in case of extreme urgency physical mode be used by other tax payers. Also the taxpayer can make electronic payment of taxes by using account of other person having net banking, if taxpayer does not have a net banking enabled account but the tax should be paid in his name.  Following are the modes of tax payments:

Income tax can be paid in two modes:

  • Physical mode/paper mode in which taxpayer fills details in a hard copy of challan and furnish it to the designated bank and bank after clearance of the cheque or deposit of cash as the case may be provides the counterfoil of challan to the taxpayer in token of tax paid depicting the following details:
    • Name of bank
    • Serial no. of challan
    • Date of clearance/deposit
    • BSR code of the bank
  • E-payment mode/internet banking mode in which taxpayer follows the following steps:
    • First access the website of the income tax department or TIN NSDL website. Address is www.incometaxindia.gov.in or use www.tin-nsdl.com site.
    • Click on e-pay taxes icon under “our services” tab on main page of the income tax website or e-payment pay taxes online icon on the main page of the tin nsdl site.
    • The link will take the taxpayer to webpage having url as https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp Same link will be opened from accessing tin nsdl site.
    • E-payment screen will appear for choosing type of challan.
    • Select challan no. ITNS 280 (payment of income tax & corporation tax)
    • Challan ITNS 280 will appear on the screen
    • Select code 0021 Income tax (Other than companies) in case of taxpayers other than companies, while if company has to deposit tax than it has to choose code 0020 Income tax on Companies (Corporation tax)
    • Correctly fill PAN and Assessment year. Name as per income tax department database will be displayed on confirmation screen and will be automatically populated as per PAN record.
    • Fill the present address. Please note amount of tax to be paid is to b filled at last stage.
    • Select type of payment. In case payment is for advance tax choose code 100, if payment is for self assessment tax choose code 300, in case payment is for depositing any demand raised by tax authorities choose code 400 (tax on regular assessment), etc.
    • Select name of bank from the list. Following bank names appears in the list:
  • Allahabad bank
  • Andhra Bank
  • Axis Bank
  • Bank of Baroda
  • Bank of Maharashtra
  • Bank of India
  • Canara Bank
  • Central bank of India
  • Corporation bank
  • Dena bank
  • HDFC bank
  • ICICI bank
  • IDBI bank
  • Indian Bank
  • Indian Overseas Bank
  • Jammu & Kashmir bank
  • Oriental bank of commerce
  • Punjab and Sind bank
  • Punjab national bank
  • State bank of Bikaner and Jaipur
  • State bank of Hyderabad
  • State bank of India
  • State bank of Mysore
  • State bank of Patiala
  • State bank of Travancore
  • Syndicate bank
  • UCO bank
  • Union bank of India
  • United bank of India
  • Vijaya Bank

After choosing name of bank, type the character shown in the box and then confirmation screen will appear showing main heading as TIN e-tax Payment. Click on submit button.  

Taxpayer will automatically be redirected to bank site for login to internet banking. After login to internet banking facility challan containing the details filled as above is populated.

Enter the amount of tax to be paid and pay the tax.

Save the challan as details regarding BSR code, Serial no. of challan, date of deposit and name of bank is to be filled in the income tax return.

The payment of taxes paid through any mode can be further verified through 26AS statement at the time of filing of the income tax return by the taxpayers.

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