Using Challan 280, you can pay income taxes, including advance taxes, self-assessment taxes, surcharges, regular assessment taxes, and taxes on distributed profits. For legal help, get in touch with Vakilsearch.
It is a fallacy to assume that all businesses want to evade or undervalue their tax liability. Some citizens prefer to pay their taxes before the due date. This is not to say it is a selfless deed or an act. But when you know your annual income or are in a position to estimate your annual income, you can calculate your income tax liability in advance and pay it off. This mechanism of paying taxes before the due date is called self-assessment. The government introduced the Challan 280 Online for taxpayers to pay their self-assessment Income Tax online. It helps pay the regular assessment tax, advance tax, and other additional charges. Since the entire process occurs online, it makes the payment method of taxes easier and more convenient. Here’s a look at the income tax Challan 280 online payment and why it is useful.
As the name states, the persons who opt for this method of paying their taxes immediately begin their books to be assessed by the tax authorities. They assess their income by themselves and pay off their taxes. This is a great way to manage your cash flow, which helps in better money management, planning and structuring.
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What Is Income Tax Challan 280 Online?
Income Tax Challan 280 Online was introduced to differentiate advance taxpayers from regular taxpayers. Since advance tax is based on an estimate, the information and the list of requirements differ from regular taxpayers who pay their taxes based on calculations made on accurate data.
The Income Tax Challan 280 Online is an effective and efficient method for advance tax online payment. While in the past, to pay these taxes, you had to visit designated bank branches and fill out various Challans, the government now allows you to do it over the internet. The only requirement for making your tax payment online has a net banking-compliant account with any designated bank.
Types Of Challan 280 Online Series
There are different taxes for different sources of income levied differently on people based on their legal status. There are five types of challans for this purpose.
| Challan Number (ITNS) | Purpose |
| 280 | IT and Corporate Tax |
| 281 | TDS and TCS |
| 282 | Security Transactions Tax |
| 284 | Foreign IT and Corporate Tax |
| 285 | Equalisation Levy |
How To Make Income Tax Challan 280 Online Payment?
- Go to the official IT department website.
- From the Tax Information tab, choose the Challan 280 option, and click on Proceed.
- Next, enter the personal and contact details asked for within the tab. Individuals should opt for Income Tax(Individual), which falls under Option 0021, and choose what tax they want to pay. The various options include;
- 100 for Advance Tax
- 102 for Surtax
- 106 for Distributed Profit Tax
- 107 for Distributed Income Tax
- 300 for Self Assessment Tax
- 400 for Regular Assessment Tax
- Once you have chosen the type, select your payment model to proceed. The payment mode may be via Debit Card or Internet Banking facilities.
- Next, choose the appropriate financial year for assessment.
- Enter your address and the Captcha, and then click on Proceed. Enter your address, and the Captcha
- Double-check the information and click on payment to the bank’s payment portal. Double-check the information and click on the payment
- Complete the payment from that portal to receive a tax receipt. Complete the payment from that portal
- Make sure you verify the payment details from this receipt, and save a copy or take a screenshot of this receipt as it contains your challan number.
Downloading The Challan 280 Online Receipt
- Log in to your internet banking service.
- SBI: From the homepage, go to E-Tax>>Reprint Challan
- ICICI: From the homepage, go to Payments and Transfers >> Tax Center >> e-Tax challans
- HDFC: From the homepage, go to Request>>Regenerate challan
Declaring the Taxes Paid
To declare taxes paid in India, individuals and businesses must follow the guidelines set by the Income Tax Department of India. Here is an overview of the process:
- Obtain a Permanent Account Number (PAN): Every taxpayer in India must have a PAN, which is a unique ten-digit alphanumeric number. If you don’t have a PAN, you can apply for one through the NSDL or UTIITSL websites.
- Determine the applicable tax return form: The form you need to use for filing your tax return depends on your income sources and the category of taxpayer. The most common forms for individuals are ITR-1 (Sahaj) and ITR-2. You can find the appropriate form on the Income Tax Department’s website.
- Gather necessary documents: Collect all the relevant documents to calculate your taxable income, such as salary slips, bank statements, investment statements, rent receipts, and any other supporting documents for deductions or exemptions.
- Calculate your taxable income: Determine your total income for the financial year by adding up income from all sources, including salary, business income, rental income, capital gains, and other income. Subtract eligible deductions and exemptions to arrive at your taxable income.
- Compute the tax liability: Use the applicable tax slabs and rates to calculate your tax liability. The Income Tax Department periodically updates the tax slabs and rates, so ensure you refer to the latest ones for accurate calculations.
- Pay the taxes: Pay the taxes due through online or offline methods, such as net banking, debit card, or by visiting an authorized bank branch. The Income Tax Department has designated banks where you can make the payment. You will receive a Challan Identification Number (CIN) or a Tax Deduction Account Number (TAN) as proof of payment.
- File the tax return: Fill out the appropriate tax return form with the required details, including personal information, income details, tax payment details, and deductions claimed. You can file your tax return online through the Income Tax Department’s e-filing portal or manually by submitting a physical copy to the relevant Income Tax Office.
- Verify the tax return: After filing the tax return online, it is essential to verify it within the specified time frame. Verification can be done electronically through Aadhaar OTP, EVC (Electronic Verification Code), or by sending a signed physical copy of the ITR-V to the Centralized Processing Center (CPC) within 120 days of filing.
Declaring The Income Tax Due Paid
Once the challan has been processed, it will reflect in your IT returns. To do so, while filing the return, you should mention the Challan number and BSR (Basic Statistical Returns) code in return. The BSR code is provided to all the registered Indian banks by the RBI. While the BSR code consists of seven digits, the Challan number usually has only five.
Advance Tax Payment
If your annual tax liability exceeds Rs 10,000, it is necessary to make advance income tax payments. Typically, employers handle these payments for the salaried class through TDS (Tax Deducted at Source) deductions.
Situations When You Have to Pay Advance Tax
If you earn a significant income from interest, capital gains, or rental income while being salaried, or if you are a freelancer or running a business, the responsibility for paying income tax falls on you.
How to Calculate and Pay Advance Tax?
When determining your income tax liability, it is important to consider all sources of income. This includes salary income, interest income, capital gains, and any other applicable sources, much like what you do when filing your income tax return. If you work as a freelancer, you should estimate your annual income from all clients and subtract any relevant expenses from it. These expenses may include rent for your workplace, internet bills, mobile bills, depreciation on computers, travel expenses, and other similar costs. For more detailed information on taxes for freelancers, it is advisable to read additional resources specifically addressing this topic.
How to Determine and Allow Deductions
In order to determine your taxable income on your tax return, it is important to minimize the deductions you wish to claim from your total income. These deductions can fall under various sections such as Section 80C, 80D, 80E, or any other applicable section
How to Calculate Tax Due on Total Income
Utilize the most recent income tax slab rates to compute your income tax liability based on your taxable income. Deduct any TDS (Tax Deducted at Source) that may have been withheld from your total tax liability. Additionally, ensure that you have made timely payments according to the specified installments. Conveniently make these payments through online channels.
Outstanding Demand Payment
On certain occasions, you might be required to fulfill an income tax payment in response to an income tax demand notice. If you are in agreement with the assessing officer’s decision and prepared to settle the demand, you have the option to make the payment online. This payment is commonly referred to as the tax on regular assessment.
Advance Tax Online Payment
If your annual tax dues exceed INR 10,000, you must pay your tax in advance. If you are an employee with a regular salary, your employer usually takes care of advance tax payments on time through TDS deductions. Here’s a look at when individuals need to pay advance tax;
- Salaried individual with high returns from capital gains/rents/interest
- Freelancing workers
- Business owners and managers
To Calculate Advance Tax, the Taxpayer Must Add Their Income From All Sources, Including;
- Salary
- Interest
- Capital Gains
- Clientele income for freelancers after deducting expenses
- Rental income.
To arrive at taxable income, make all the necessary deductions per Sections 80C, 80D, 80CCC, 80CCD, and 80E.
Next, check which income slab you fall into and calculate the income tax due after reducing any TDS deducted from the total tax. Here’s how to pay your advance tax per the 2022-2023 schedule.
| Due Date | Installment |
| On or before June 15th | Up to 15% |
| On or before September 15th | Up to 45% |
| On or before December 15th | Up to 75% |
| On or before March 15th | Up to 100% |
Self Assessment And Regular Assessment Tax Online Payment
The IT return submission occurs only after the complete payment of all taxes due. Sometimes, while filling out the IT return, you will see that you have a certain amount unpaid, and this amount is the Self Assessment Tax. To ensure the successful Filing of your IT returns, you must pay this tax online, and if you miss the deadline, as per Section 234B and C, you will have to pay the interest due as well. The Income Tax Challan 280 online Payment made online to comply with an IT demand notice sent by an assessing officer is called regular assessment tax.
Conclusion:
Among all the regulatory requirements a citizen must abide by, taxation is by far the most complicated and least common-sensical. This is because tax policies and regulations are formulated from a bird’s eye point of view of the macroeconomic atmosphere, a perspective to which the common person has no access. That is why when it comes to taxation, it is always better to seek the guidance of a tax expert who will not just ensure that your Income Tax Challan 280 online Payment and formalities are met diligently but also ensure that your taxable income is structured in such a way that your tax liability is at its minimal. If you have any further queries concerning taxes or need help with processing your advance tax, contact our team of tax experts so that they can understand your requirements in detail and ensure you receive the best possible guidance.
FAQs
What is included in my total tax payable during a year?
Your total tax payable during a year includes the income tax calculated based on the applicable slab rates on your taxable income, along with any other taxes such as surcharges and cesses that may be applicable.
Is it necessary for me to pay taxes online? If not, how can I pay for it?
While it is not mandatory to pay taxes online, it offers convenience and several benefits. You can also pay taxes offline through physical modes such as cash or cheque at designated bank branches or authorized collection centers.
Are there any benefits of paying taxes online?
Yes, there are several benefits of paying taxes online, including convenience, time-saving, instant acknowledgment, reduced chances of errors, and the ability to track your payment status online.
What are the basic things I need to be prepared with in order to pay my taxes online?
To pay taxes online, you typically need to have the following: a stable internet connection, a computer or mobile device, access to the income tax department's online portal, your PAN (Permanent Account Number), and details of your income, deductions, and tax liability.
What all taxes can be paid electronically?
Various taxes can be paid electronically, including income tax, advance tax, self-assessment tax, tax on regular assessment, tax deducted at source (TDS), and tax collected at source (TCS).
What are the various challans that are applicable for various types of payments?
The income tax department uses different challans for various types of tax payments. The most common ones include Challan 280 for income tax, Challan 281 for TDS, Challan 282 for payment under the Income Declaration Scheme, and Challan 283 for payment under the Pradhan Mantri Garib Kalyan Yojana.
Whom should I contact if I face any issues while making tax payment online?
If you encounter any issues while making tax payment online, you can reach out to the helpline or customer support of the income tax department. They can assist you with resolving technical problems or provide guidance regarding the payment process.
What to do when you have selected the wrong assessment year while paying tax?
If you have selected the wrong assessment year while making a tax payment, you should immediately contact the income tax department or consult a tax professional. They can guide you on the necessary steps to rectify the error and ensure that your payment is correctly allocated to the appropriate assessment year.
