June 26, 2014

CA CS ICWA TAX PROFESSIONALS PORTAL - ARTICLE - HOW TO PAY INCOME TAX / CORPORATION TAX ONLINE

UNIVERSAL KNOWLEDGE HUB

Different Types of Taxes:



Before, we know how to pay taxes; we must know first what are the different types of taxes under Income Tax Provisions

Taxes include interest and penalty also, but we will discuss about taxes paid by the assesse or taxes deducted from the income of the assesse alone.

There are popularly three types of taxes we have:

·         Tax Deducted at Source: When the person responsible to pay any income to the any other person, and when the person who is responsible to pay the income, pays the income after deducting the tax thereon, such tax deducted will be known as Tax Deducted at source. In this, the person who is paying the income is liable to deduct TDS, and if doesn’t deduct TDS he will be liable for non deduction of TDS. The person from whose income the TDS is to be deducted is in no situation can be held responsible for the non deduction of TDS liability.

·         Advance Tax: If the tax payable by the person for the financial year exceeds Rs 10000 he is liable to pay his tax liability to pay Advance Tax.

·         Self Assessment Tax: Self Assessment tax means any balance tax paid by the assessee on the assessed income after taking into account the TDS and Advance tax before filing the Return of income.

What is Advance Tax?
Section 207: Advance Payment of Tax

Advance Tax shall be payable in accordance with the provisions, only if the provisions are applicable to the assesse.

Advance Tax provisions are not applicable to the following:

·         A person (Indian Resident Only) does not any income chargeable under the head “Profits and gains of business or profession” and who attains the age of  60 years or more anytime during the financial year

·         Provisions of Advance Tax are not applicable to the assesse covered under Eligible business (Assesse covered engaged in the business and declares their income as per Section 44AD)

Section 208: Conditions of liability of Advance Tax

Advance Tax shall be payable during the year where the amount of tax payable during the year is Rs 10000 or more

Section 209: Computation of Advance Tax

Tax shall be calculated in the following manner:
Particular
Amount
Tax on Total Income
XXX
Add: Surcharge and Cess
XXX
Total Tax
XXX
Less: TDS deducted
XXX
Amount of Advance Tax
XXX

Section 211: Instalments of Advance Tax and due dates:

Due date of Instalments in the relevant Assessment Year
Amount payable by Corporate Assesse
Amount payable by Non- Corporate Assesse
On or before June15
15 % Advance Tax Payable
----
On or before September 15
45 % Advance Tax Payable
30 % Advance Tax Payable
On or before December 15
75 % Advance Tax Payable
60 % Advance Tax Payable
On or before March 15
100 % Advance Tax Payable
100 % Advance Tax Payable

Other Points:

Any amount paid by way of advance tax on or before 31st March of the relevant previous year shall also be treated as Advance Tax paid during the financial year ending on that day. But, interest u/s 234C applicable (Section 219)

Self Assessment Tax: Section 140 A

Calculation of Self Assessment Tax

Particular
Amount
Tax on Total Income
XXX
Add: Surcharge and Cess
XXX
Total Tax
XXX
Less: Relief and Rebate
XXX
Less: TDS deducted
XXX
Less: Advance Tax Paid
XXX
Amount of Self Assessment Tax
XXX

Assesse himself is liable to pay self assessment tax to the credit of Central Government. So in case of any failure to do so, he will be liable for interest and penalties.

How to pay tax:

There are two methods to pay:

E payment of taxes (Payment of taxes online)
Other Methods (Generally include offline method of Payment of taxes)

As per Notification No 34/2008 dated 13.03.2008, Following categories of assesses are mandatorily required to make e payment of tax:

·         Corporate Assesses
·         Non Corporate Assesses subject to Tax audit

Mode of Payment

·         Internet Banking  Facility
·         Credit Card or Debit Card (State Bank of India)

As per Circular 5/2008 dated 14.07.2008

An assesses can make E payment of taxes also from the account of other person. The challan must indicate the PAN of the assesses for whom payment is made.

How to pay Online Tax:

Step 1: Go to website to pay taxes, follow this link Pay Online Taxes




Step 2: Click on Challan No 280


Step 3: Seclect Tax Applicable : Income tax on companies for companies or other than companies for others. Fill required details in the Sheet, PAN, Address, Advance Tax or Self  Assessment Tax, then fill the bank name and special character. Then click proceed.

Step 4: A page will open, then read the information, if finds it correct, the click submit to the bank




Step 5: A new sheet will open demanding user id and password, make log in and pay taxes

Step 6: After paying online receipt will generate, which shows the date, amount, and time of payment of tax along with Challan No.

Step 7: Use Challan No, BSR Code and Date in all future correspondence

How to pay Tax Offline

Step 1: Take Challan NO 280, it is available on internet the file can be download from the link Download Challan 280

Step 2: Fill the challan details

Step 3: Submit the challan to the banker along with amount

Step 4: Banker will take amount, and mention the date, challan no, and BSR Code on the challan copy and return the page belong to assesse

Step 5: Use Challan No, BSR Code and Date in all future correspondence



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