In India, tax collection is one of the most important and difficult tasks that is carried out by the Income Tax Department in India. In fact, among developing countries, India has one of the lowest rates of tax collection in the world and there is scope for a lot of improvement in terms of tax collection and to facilitate this, various measures are taken including Challan 280 to help improve tax collection. Looking at our statistics, the current situation looks quite bleak. India's tax-to-GDP ratio is only 16. This rate is lower than even half of the average ratio for OECD Organization for Economic Co-operation and Development nations which is currently have an average tax to GDP ratio of 34%. While one of the key factor behind this apparently dismal performance in India is the exclusion of a wide base of the population from the taxation slabs through various exemptions, the other and more worrisome, is the less than responsible behavior of the eligible taxpayers. The money so collected by the government is used for development of infrastructure, education, health, defense and similar crucial sectors. For instance — Self-Assessment Tax and Advance Tax. Taxes collected at source TCS on behalf of the taxpayer at the time of incurring an expense. This is applicable for all types of income tax payments such as Self-Assessment Tax, Advance Tax, Regular assessment tax, surcharge, tax on distributed income or distributed profits. Modes of Income Tax Payments There are two ways through which income tax can be paid. One is through the online route i. Irrespective of the mode of payment opted for by an individual, Challan No. Tax Information Network TIN is an initiative by the Income Tax Department of India ITD for the modernization of the current system for collection, processing, monitoring and accounting of direct taxes using information technology. TIN is a repository of nationwide Tax related information, and has been established by the National Securities Depository Limited NSDL on behalf of the IT Department. E-Payment enables payment of taxes by the taxpayers through the medium of internet. In order to benefit from this facility, the taxpayer needs to possess a banking account with online access features through any one of the authorized banks empanelled with the IT Department. The webpage for paying the TIN-based tax online is TIN NSDL webpage. If it is being levied on a company, then the first radio button i. In case the tax is being paid by any other assessee such as Partnership Firms, individuals, LLP, etc. It is imperative that the taxpayer checks this detail carefully as a wrong PAN input will lead to the tax being deposited against some other account. Many times, taxpayers get confused with the terms — Financial Year and Assessment Year. Simply put, financial year is that time period in which the income is earned and assessment year is the year after the end of the financial year and in which the tax needs to be paid. So, if the income was earned anytime between April 2015 and March 2016, then the financial year FY would be 2015-16 and Assessment Year AY would be 2016-17. It is displayed based on the PAN details entered earlier and as available in the database of the Income Tax Department. However, information on city, state and pin code needs to be mandatorily entered. This enables the IT Department to get in touch with the taxpayer quickly, in case of any issues or queries. While, if the tax is being deposited after the end of the financial year, when a demand has been raised by the IT Department, it would be tax on regular assessment. The list of banks is shown via a dropdown menu and the taxpayer needs to select the applicable one from there. This would lead to a verification page wherein all the details provided will be displayed once more for confirmation. This challan contains details like CIN Challan Identification Number , amount paid in tax, date of payment, etc. It is a wise decision to save a copy of this acknowledgement receipt either by saving it digitally or preserving its printed copy. The CIN is an important detail as it can be used by the tax payer for any future correspondences with the IT Department as well as during Income Tax returns. However, there are times when the user fails to save a copy of this receipt or misplaces the same. In that case, most of the banks offer the facility of regenerating the Challan for the e-Payment of Direct Taxes through TIN-NSDL website. The IT Department offers a facility to taxpayers wherein they can check and confirm the status of their challan as well as verify if the payment made by them Using the online Challan No. However, users should keep in mind that it takes couple of days for the payment to be reflected on this link. This system is extremely beneficial as the taxpayer is not required to personally visit the bank to make the payments. The government realizes the fact that internet penetration is not very high in our country. According to the industry reports, only one-third of the total population has access to the internet. The penetration is especially poor in our rural areas. Hence, only relying on online mechanisms, though more convenient, for both the taxpayers and the authorities, would marginalize a large section of our society. Hence, the IT Department has retained the offline method of tax payments. Under this method, taxpayers need to download the Challan No. They need to furnish the required details in the form Similar to the online form such as, PAN, the Assessment Year, residential address, contact details, e-mail ID etc. The bank will issue a stamped counterfoil which will act as a proof of the payment made by the taxpayer. The banks have a time frame of 7 days, from the date of receiving such correction requests from the taxpayer, to make these changes. Correction by Assessing Officers Applicable for online as well as offline mode After the window for correction available with banks for challan correction has expired, the taxpayer can raise a request for correction to the concerned Assessing Officer. Taxpayers can get information about their assessment from the website of the Income Tax department by providing their respective PAN details. Changes introduced by the Government The government, in order to simplify the process of tax payment and ensure a higher degree of convenience for the taxpayer, has made many changes in the process of payment as well as revised the challan forms to make the process even more streamlined. With effect from 1st June, 2004 the IT Department has introduced a new system for which it is immensely beneficial to the common tax payer. Instead of the complicated four copy challan forms, the taxpayer was given only a single copy of the simplified Challan that needed to be filled out. This new and revised challan could be filled out much faster. Secondly, changes were introduced which made it possible to receive an acknowledgement for taxes paid through the banks immediately after the payment. They could simply mention the CIN details in the income-tax return.
