The Indian Income Tax Act determines how much an individual owes the State as tax liability. This amount is decided based on several factors such as age, source of income, and income earned in the last fiscal year. The total annual income of a person is then scrutinised and a certain percentage of it becomes that person’s tax liability. Afterwards, the individual can rely on several different ways to discharge this liability, such as Advance tax, self-assessment tax and TDS/TCS. In this article, we will be taking a look at everything concerned with Tax Deduction at Source, and how to make online payments for the same. But before that let us have a glance at the tax slabs.
Tax Deducted at Source, better known as TDS is a way of collecting tax as per the Income Tax Act, 1961. As per this method, the tax that an individual is liable to pay is deducted at his or her income source according to predetermined TDS Rates, and the amount leftover after deduction is paid as the salary by the employer. After collecting the tax of all the employees in this manner, the employer must deposit this amount to the government within a specified period of time.
The fundamental need of such a system is to handle the tax liability at the income source itself, as a way of lessening other compliance measures required. Furthermore, the individual from whose salary the tax has been deducted receives a credit for the sum of money deducted, through Form 26 AS or the TDS certificate issued, making TDS, an indirect method of collecting tax.
Here’s a look at all the incomes for which the online payment of TDS is acceptable and eligible:
Here’s a look at how you can do the online payment of TDS. The most common methods are online payment of TDS and the physical payment of the TDS.
Electronic Mode or e-payment of TDS is necessary for all the corporate assets owned by a taxpayer, and also for assets which fall under Section 44 AB of the Income Tax Act. In order to do the online payment of TDS, here are the prerequisites needed:
To pay TDS via the physical mode, the taxpayer must submit challan 281 to an authorized bank after paying the money due from him or her.
After making the payment, you can track your challan status online through the webpage. Visit the NSDL portal and log into your account. From the homepage, go to the Challan Status Inquiry tab. You can start tracking your challan seven days after having made the payment. Also, you can make use of two methods to track your challan online. You can opt to enter your CIN and details such as bank code to see the status of your challan. This will bring up details such as date of deposit, TAN number and date of receipt. The other method to track your challan involves providing your TAN and payment date. This will provide you with details such as CIN, payment nature, and date of receipt.