Challan 280 - How to Pay Your Income Tax Online with Challan 280?

Income tax payments facility have been migrated from OLTAS to ‘e-Pay Tax’ facility on the e-filing portal. You can refer to this guide for a step-by-step process for making your tax payments.

Challan 280 is one way to pay your advance tax, regular assessment tax, self-assessment tax, additional charges, etc. online. Let’s discuss how.

Read about the Union Budget 2023 highlights here.

Steps to Pay Income Tax Due

Step 1: Select Challan 280

Go to the tax information network of the income tax department and click on ‘Proceed’ under Challan 280 option.

Step 2: Enter Personal Information

For individuals paying tax:

Step 1: Select (0021) Income Tax (Other than Companies)
Step 2: Select the type of payment correctly from the following:

• (100) Advance Tax
• (102) Surtax
• (106) Tax on Distributed Profit
• (107) Tax on Distributed Income
• (300) Self-Assessment Tax
• (400) Tax on Regular Assessment

Select ‘Self-assessment tax’, if you have any taxes due to pay while filing your income tax returns.
Step 3: Select the mode of payment you wish to choose. There are two modes of payment available – Net banking or debit card
Step 4: Select the relevant assessment year (AY). For the period 1st April 2022 – 31st March 2023, the relevant AY is 2023-24
Step 5: Enter your complete address
Step 6: Enter Captcha in the given space and click on ‘Proceed’.

Step 3: Double check Information

Double-check the information displayed and you will have to submit the request to the bank. Then, you will be redirected to your bank’s payment page.

Step 4: Check Receipt (Challan 280)

After completing the payment, you’ll get a tax receipt on the next screen where you can see the payment details. You can see the BSR code and challan serial number on the right side of the challan.

Important: Save a copy of the tax receipt or take a screenshot. You’ll need to enter the BSR code and challan number to enter in your tax return.

Pay Your Tax Due

If you’ve missed downloading the copy of your tax receipt, you can log in to your net banking account and retrieve it. 

SBI Bank account holders Login and go to e-tax (on the header) > Reprint challan (on the sidebar) to view the challan

ICICI Bank account holders Login and on the header click on Payments and Transfers > Tax Center > e Tax challans

HDFC Bank account holders: Log in and click on ‘Request’ on the sidebar, scroll down and click on Regenerate Direct Tax Challans

Declaring the Taxes Paid

After you have made the tax payment, you need to furnish this information in your income tax return. Go to the Taxes Paid Summary page on ClearTax to update this information. Select the “Self Tax Payments” tab and enter the BSR code and challan number from Challan 280.

Note: BSR code is a 7-digit number and the challan serial number is 5 digits.

Advance Tax

If you have annual tax dues exceeding Rs 10,000, you must pay income tax in advance. Usually, for the salaried class, employers take care of these income tax payments via TDS deductions.

Situations When You Have to Pay Advance Tax:

• You are salaried but have high income from interest or capital gains or rental income
• You are a freelancer
• You are running a business

How to Calculate and Pay Advance Tax?

Add income from all sources. Include salary income, interest income, capital gains etc., just like you do at the time of filing your income tax return. If you are a freelancer, estimate your annual income from all clients, and deduct expenses from it. Rent of your workplace, internet bills, mobile bills, depreciation on computers, travel expenses etc. some expenses. Read more information on freelancers and taxes.

How to Determine and Allow Deductions

Reduce deductions you want to claim from your total income and arrive at your taxable income on your tax return. The deductions that come under Section 80C, 80D, 80E or any other you want to claim. Read more on Section 80C, 80CCC and 80CCD.

How to Calculate Tax Due on Total Income

Apply the latest income tax slab rates on your taxable income to calculate your income tax due. Reduce any TDS that may have been deducted from your total tax due. And make sure you have paid according to these instalments. You can make these payments online.

Our CAs can calculate your advance tax liability and help you with paying it online. Seeing a large tax outgo? Don’t worry, our CAs can help calculate your freelancing income and make sure your taxes are optimized.

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Due Dates of Payment of Advance Tax for FY 2022-23

Non-payment of advance tax can result in penal interest levy under sections 234B and 234C.

Self-Assessment Tax

You cannot submit your income tax return to the income tax department unless you have paid tax dues in full. Sometimes, you may see tax payable at the time of filing your return. This tax is called Self Assessment Tax, which you can pay online to ensure successful e-filing. 
You should also pay the interest under sections 234B and 234C along with your tax due, if you are paying tax after 31 March. When you e-file with ClearTax, our system will automatically tell you how much tax you need to pay to file your return. You can also get your return verified by a CA to make sure that you paid the correct amount.

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Outstanding Demand Payment

Sometimes, you may have to make an income tax payment to comply with an income tax demand notice. If you agree with the assessing officer and are ready to pay the demand, you may do so online. It is also called the tax on regular assessment.

Frequently Asked Questions

What is included in my total tax payable during a year?

You arrive at your income taxes due by totalling all your income, availing all applicable deductions, determining your taxable income and then calculating your taxes at rates applicable to the income slab you fall under. As a next step, if your income falls between Rs 50 lakh and Rs 1 crore, a surcharge of 10% would apply and if your income exceeds Rs 1 crore, a surcharge of 15% would apply on taxes due. Further, 4% of taxes due (plus surcharge if any) will have to be added by way of health and education cess. If your income during a year is less than Rs 5 lakh, you are eligible to claim a rebate under Section 87A up to Rs 12,500 or taxes due, whichever is lower.

Is it necessary for me to pay taxes online? If not, how can I pay for it?

The law mandates that only the following taxpayers must mandatorily pay their taxes online: a. Companies b. Taxpayers other than companies that are subject to audit under Section 44AB. The remaining taxpayers can pay taxes in physical form by submitting the challan at designated banks. However, you can also avail the e-payment option as it is easy and saves time too.

Are there any benefits of paying taxes online?

Definitely. Not only does e-payment save time, but you can also avail the facility anytime and anywhere. Further, unlike the physical mode of payment where the credit of taxes paid goes to the government at least after a day only, online payment gives credit to the government immediately.

What are the basic things I need to be prepared with in order to pay my taxes online?

For making e-payment of taxes, make sure you have an internet connection and internet banking enabled for your bank account. In case you do not have net banking, you can make payments using the net banking account of any other person. However, please make sure the taxes are discharged in your name and against your PAN only, for you to get the credit.

What all taxes can be paid electronically?

These days, the online facility of payment has been enabled for almost all kinds of taxes. Here are some taxes that can be paid online:

a. Income tax

b. Corporate tax

c. TDS (Tax Deducted at Source)

d. TCS (Tax Collected at Source)

e. Securities Transaction Tax (STT)

f. Equalisation levy

What are the various challans that are applicable for various types of payments?

The various challans and the nature of tax payments for which they are applicable are captured in the below table:

Whom should I contact if I face any issues while making tax payment online?

While making e-payment, in case you encounter any problem at the NSDL website, you can contact the TIN call center. In case you face any problem at the payment gateway of your bank, you can contact your bank.

What to do when you have selected the wrong assessment year while paying tax?

Even if you have been cautious while paying taxes, you may end up making a mistake, i.e. you may choose a wrong assessment year at the time of making payment. The major cause for such a mistake to happen is not knowing the meaning of the term ‘assessment year’. Assessment year means the year in which your taxes are assessed. Precisely, it is the year following the year for which you are paying the taxes. If you are paying taxes for the year 2021-22, the assessment year to pay this tax will be 2022-23.If you have chosen the assessment year incorrectly, follow the below steps:

Step 1: Mention the payment details when you file your IT returns for the year even if the assessment year you have chosen while paying the tax is incorrect.
Step 2: You can request the office of your jurisdictional assessing officer to correct the challan for the error in the ‘assessment year’. You can locate the office of the assessing officer on the e-filing website of the income tax department. In a case where you have just paid a challan, you can request the bank to do the challan correction within 7 days of the date of deposit.
Step 3: When the assessing officer (AO) processes your returns, he most probably issues a notice as the payment details do not match with the records.
Step 4: Respond to the AO with the details of the error caused while paying the tax.
Step 5: You must also submit a rectification of return under Section 154.
Step 6: The AO has the power to make the required corrections in your return if he is convinced with your rectification request. Once he approves your request, he will make the required changes in the IT returns and close it.

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