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You can now pay your income tax online. Here are few steps to follow for making online tax payments.

Q. What is the procedure for paying taxes online?
A. Follow these steps to pay tax online:-

Step 1
a) Click here to open online tax payment page of NSDL
b) Click on Please Click Here link located towards bottom of the page (you need to have an account with any of the listed Banks on this page, to avail online tax payment facility)
c) Select the required challan (For payment of income tax, select challan no. ITNS 280)

Step 2
After selecting the required challan, you will be directed to the screen for entering the following data:-
a)Select box "0021 Income-tax" if you are an individual or box "0020 Corporation-tax" if you are paying taxes for a company
b) PAN of the taxpayer
c) Name and address of the taxpayer
d) Assessment Year
e) Type of payment (e.g. "100 for advance tax payments" , "300 for self assessment tax payments")
f) Select the bank name from the drop down provided

Please ensure that you enter PAN correctly, as this is extremely important for further processing. The system will check the validity of PAN. In case PAN is not available in the database of the Income Tax Department then you cannot proceed with the payment of tax.

Step 3
After entering all the above detail, click on PROCEED button. The system will display the contents you have entered along with the “Name” appearing in the Income Tax Department database with respect to the PAN entered by you.

Step 4
You can now verify the details entered by you. In case you wish to modify any details, click on EDIT. To move further, click on SUBMIT button. You will be directed to the net-banking site provided by your bank.

Q. What is the procedure after being directed to the net banking site of the bank?
A. You will have to log on to the net banking site of your bank using your login ID and password/PIN provided by the bank. The details entered by you while filling up the challan will be displayed again.

You will now be required to enter the amount of tax you intend to pay and also select your bank account number from where you intend to pay the tax. After verifying the correctness, you can proceed with confirming the payment.

Q. What will happen after I confirm the payment of tax at my bank’s site?
A.Your bank will process the transaction online by debiting the bank account indicated by you and generate a printable acknowledgment indicating the Challan Identification Number (CIN). You can verify the status of the challan in the Challan Status Inquiry using CIN after a week of making payment.

Q. What is Challan Identification Number (CIN) and what is its relevance?
A. Challan Identification Number (CIN) has three parts
a) Seven digit BSR code of the bank branch where tax is deposited
b) Date of Deposit (DD/MM/YY) of tax
c) Serial Number of Challan

CIN is used to uniquely identify the tax payment. CIN has to be quoted in the return of income as a proof of payment. CIN is also to be quoted in any further enquiry.

PAY YOUR INCOME TAX ONLINE NOW

You can now apply for a PAN (Permanent Account Number) card online in India. We have tried to answer few queries about the PAN card here:

Q. What is a PAN?
A. PAN (Permanent Account Number) is a ten digit alphanumeric number issued by Income Tax Department. This is issued in form of a laminated card (called PAN card).

Q. Who must have a PAN?
A. All tax payers who are required to furnish Income Tax Return should have a PAN.
All persons intending to enter into financial transactions, where quoting of PAN is mandatory must also obtain PAN.

Q. Can I have more than 1 PAN?
A. No. Having multiple PAN for same person or company is against the law

Q. How do I apply for PAN?
A. You need to fill up Form 49A and apply for PAN. You can apply for PAN online or offline. Click here to apply for PAN online. Alternatively, you can submit the completed Form 49A at IT PAN Service Centre or TIN Facilitation Centre.

Q. What documents are required with PAN application?
A. 1. For Individual applicants need to affix one recent, coloured photograph (Stamp Size: 3.5 cms x 2.5 cms) on Form 49A
2. Proof of Identity: Copy of school leaving certificate or matriculation certificate or degree of a recognized educational institution or depository account or credit card or bank account or water bill or ration card or property tax assessment order or passport or voter identity card or driving license or certificate of identity signed by a MP or an MLA or a Municipal Councilor or a Gazetted Officer
3. Proof of Address: Copy of electricity bill or telephone bill or depository account or credit card or bank account or ration card or employer certificate or passport or voter identity card or property tax assessment order or driving license or rent receipt or certificate of address signed by a MP/ MLA/Municipal Councilor / a Gazetted Officer

To know more about PAN, please click here.

APPLY FOR YOUR PAN CARD NOW

National Savings Certificates (NSC)

National Saving Schemes (NSC) is one of the popular Income Tax Saving schemes which is available throughout the year. It can be operated singly, jointly, or by a minor with his/her parent or guardian. There is a return on this scheme at interest rate of 8%. The minimum investment limitation of the scheme is Rs.100/- and with no upper limit. Other investments can be done in multiple of Rs. 100/-. This scheme has a maturity period of 6 years. It is transferable and also there is a provision of loan on the basis of this scheme. Under section 88 of the Income Tax Act, 1961 any person can take benefit in income tax on amount invested in this scheme and under section 80L of Income Tax Act, 1961 there is a provision of benefit on interests coming from scheme.

Public Provident Fund (PPF)

Under this scheme, there is a return at the interest rate of 8% p.a. The minimum investment limit is Rs. 500/- and maximum limitation is Rs. 70,000/-. It can be opened any time throughout the year. It can be operated either singly or jointly. In case of minor, with parent/guardian. There is also a facility of nomination in this scheme. This scheme has a maturity period of 15 years. The first loan can be taken in the third financial year from the date of opening of the account, or upto 25% of the amount at credit at the end of the first financial year. Loan amount can be returned in maximum of 36 installments. A person can withdraw an amount (not more than 50% of the balance) every year. Under Section 88 of Income Tax Act, 1961 there is a provision of tax benefit by investing in this scheme. Interest on this scheme is tax free.

Kisan Vikas Patra (KVP)

Money invested in this scheme doubles in 8 years. There is a minimum investment limitation of Rs.100/- with no upper limit. This scheme is available throughout the year. It can be operated either singly or jointly. In case of minor, with parent/ guardian. Facility for nomination is also available under this scheme. Currently there is no tax benefit on investment under this scheme.

Post Office Scheme (POS)

It is one of the best Income Tax Saving Scheme. It can be operated by either singly or jointly. In case of minor, with parent/ guardian. It is available throughout the year. There are several types of post office schemes depending upon the type of investment and maturity period. Post office schemes can be divided into following catagories:

• Monthly Deposit
• Saving Deposit
• Time Deposit
• Recurring Deposit

Special Schemes For Retiring Person

Government Employees : There is a return at the rate of 8% per annum. The minimum investment is Rs.1000/- and maximum amount equal to the total retirement benefit. Maturity period of this scheme is 3 years. According to Income Tax Act, 1961 interest on this scheme is tax free.

Public Sector Employees: Under this scheme there is a return of 9.5% payable half-yearly on 30th June and 31st December respectively. There is a minimum investment limitation of Rs.1000/- and the maximum limitation is the amount equal to total retirement benefit. It can be operated by retired PSU employees in his/her own name or with the spouse, jointly. In this scheme, there is a facility of premature encashment. Entire balance or part thereof can be withdrawn after the expiry of three years from the date of deposit. Maturity period of this scheme is 3 years. According to Income Tax Act, 1961 interest on this scheme is tax free.

Postal Life Insurance For

This scheme is in operation for the last 117 years. This scheme started in 1884 as a welfare measure for the employees of Postoffices & Telegraphs Department under Government of India to the Secretary of State (having dispatch No. 299 dated 18-10-1882). But after few years, various departments of Central and State Governments were extended its benefits. Now it is open for employees of all departments of Central as well as State Government, Nationalized Banks, Public Sector Undertakings, Financial Institutions, Local Bodies like Municipalities and Zila Parisads, Educational Institutions aided by the Government. According to Income Tax Act there is also a provision of special relaxation in income tax on the basis of investment done in urban or rural areas.

Dividend

According to Income Tax Act,1961 there is a provision benefit in Income Tax if assessee has an income as a dividend on investment in any of the following:

• Shares
• Mutual Funds
• Unit of UTI

This dividend can be given by any company or coperative society.