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E-payment of Income Tax in India

The e-payment facility was launched by the IT department for payment of direct taxes online by taxpayers. As a result of this, taxpayers can now choose from two modes of payment for direct taxes (i) physical mode i.e. payment made by producing the hard copy of the challan at the authorized bank and (ii) e-payment mode i.e. making payment via net-banking with any of the authorized banks.

Mandatory E-payment

Some taxpayers are not permitted to use the physical mode of tax payment, rather they can only pay taxes through the e-payment mode. Taxpayers that fall under this category are:

  • All companies

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

Anyone who does not fall in the mandatory category can choose to voluntarily pay his or her taxes through the e-payment route. It is always advisable to select the e-payment mode since it saves both time and efforts.

Requirements for Making E-payment

In order to pay taxes through the e-payment route, one needs to have a net banking enabled account with an authorized bank. In case the assessee does not hold a net banking enabled account, the individual can make e-payment through the account of another person, however, the tax should be paid in his or her name.

Benefits of E-payment of Income Tax

There are many benefits of choosing the e-payment mode for payment of income tax. Some of these advantages are:

  • E-payment of income tax is time saving, simple and safe. It can be done any time from any place.

  • The amount will be instantly transferred from your bank account.

  • You can enquire whether the Income Tax Department has received the tax amount on the official website of the IT Department.

  • Details of the e-challan will be sent directly to the Income Tax Department. The bank will not have to go through any data entry.

  • A receipt for tax payment is issued right away when the income tax amount is deducted from the online bank account

Taxes That Can Be Paid Electronically

A taxpayer can use the e-payment mode for paying the following direct taxes:

  1. Income-tax

  2. Corporate tax

  3. Equalization Levy

  4. Securities Transaction Tax (STT)

  5. Tax deducted at source (TDS)

  6. Tax collected at source (TCS)

  7. Wealth-tax and other direct taxes like gift tax, expenditure tax, etc.

Nature of Challan That Needs to Be Used

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

E-payment Procedure:

Follow the below steps to pay income tax through the online mode:

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

  • Step 2: Go 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 now be redirected to a page asking for the following data:

    • Permanent Account Number

    • Assessment Year

    • Address details of taxpayer

    • Type of Payment

    • Mode of Payment

  • Step 5: After entering all the necessary details, click on the Proceed button. A confirmation screen will be displayed.

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

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

  • Step 8: After the payment is made, a confirmation receipt will be displayed on the bank website. The acknowledgement you will receive contains the Challan Identification Number, payment details and bank name.

List of Authorized Banks That Provide E-payment Facility

  1. Allahabad Bank

  2. Andhra Bank

  3. Axis Bank

  4. Bank of Baroda

  5. Bank of India

  6. Bank of Maharashtra

  7. Canara Bank

  8. Central Bank of India

  9. Corporation Bank

  10. Dena Bank

  11. HDFC Bank

  12. ICICI Bank

  13. IDBI Bank

  14. Indian Bank

  15. Indian Overseas Bank

  16. Jammu & Kashmir Bank

  17. Oriental Bank of Commerce

  18. Punjab and Sind Bank

  19. Punjab National Bank

  20. State Bank of India

  21. Syndicate Bank

  22. UCO Bank

  23. Union Bank of India

  24. United Bank of India

  25. Vijaya Bank

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

Challan 280 needs to be filled for making E-payment of income tax and corporate tax. Following are some of the points that need to be noted while providing details in Challan 280:

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

  • 0020 - This is applicable for the income tax paid by companies

  • 0021 - This is applicable for the income tax paid by non-corporate taxpayers

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

  • 100 - This is applicable for payment of advance tax

  • 300 - This is applicable for payment of self-assessment tax

  • 400 - This is applicable for tax on regular assessment

  • 106 - This is applicable for tax on distributed profit

  • 107 - This is applicable for tax on distributed income

  • 102 - This is applicable for surtax

E-payment of Service Tax

E-payment of service tax has been made mandatory with effect from 1 January 2014 for assessees who have paid over Rs. 1 lakh as service tax during the previous financial year. The procedure of e-payment of service tax is as follows:

  • Step 1: Visit cbec-easiest.gov.in/EST/InputPageForEPaymentServlet

  • Step 2: Enter the 15-digit service tax registration number allotted by the Jurisdictional Commissionerate

  • Step 3: There will be an online verification on the validity of the Assessee Code entered. If the code is valid, then your details as saved in the Assesses code master like name, address, etc. will be displayed.

  • Step 4: Select the accounting codes for which you are filing tax and choose the service for which tax is to be paid

  • Step 5: After submission of input details, select the bank through which the payment is to be made. This will take you to the bank's website, where you have to enter the user ID, password and the payment details.

  • Step 6: Once the payment is successful, a challan counterfoil will be displayed, which will contain Challan Identification Number, payment details and bank. This counterfoil will be the proof of the payment made.

FAQs

What is e-payment of taxes?

E-payment of taxes is a facility launched by the Income Tax Department that allows taxpayers to make income tax payments using the net-banking facility.

Is it compulsory for all companies to pay income tax via the e-payment route?

Yes, it is compulsory for every company to pay income tax using the internet banking facility. It is mandatory for the following assessees to pay the tax only through the e-payment mode:

  • All companies

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

What do I do in case there is an error while making e-payment of taxes?

While making e-payment, if the taxpayer faces any problem at the NSDL website, he or she should contact the TIN call centre by dialling 020 - 27218080 or writing an email to tininfo@nsdl.co.in.

Is there any security risk to my transaction via e-payment?

There are no risks to transactions undertaken via e-payment since they are encrypted via Secure Socket Layer, and is therefore safe.

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