There was a time when the Income Tax Department used to collect Income Tax manually, but this process came to an end due to certain errors that popped every now and then. OLTAS or Online Tax Accounting System came into being to overcome the errors that came during the manual process and make the whole process faster. Challan 280 is used for the payment of Income Tax.
OLTAS is responsible for collection, accounting and reporting of receipt as well as payments of Direct Taxes. Earlier, three copies of Challans were issued, but after OLTAS came into being single copy of challan is issued with a tear off strip for taxpayer.
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Here are three types of Challans that are used by Income Tax Department: –
Challan 280 is used for the payment of Income Tax, this payment can be in the form of Self-Assessment Tax, Advance tax, tax on regular assessment, tax on distributed profits or income. A taxpayer can pay Tax with cheque, DD etc. The Challan 280 should be used, irrespective of the mode of payment.
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Challan 281 is used for depositing Tax Deducted at Source (TDS) or Tax Collect at Source (TCS).
This Challan should be used, when you are making a payment of Gift Tax, Wealth Tax, Expenditure Tax, Estate Duty, Securities Transaction Tax and Other Direct Taxes.
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All about Challan 281
Challan 281 is used to deposit Tax Deducted at Source and Tax Collected at Source by corporate as well as non-corporate entities. TDS or Tax Deducted at Source is a process introduced by the Government in which the deductor, a person or a firm that deducts tax before making the payment of specified nature (such as salary, rent, etc.) to the deductee, the person who tax has been deducted shall deduct tax at specified percentage from such amount payable and deposit it to the Income Tax Department. TCS or Tax Collected at Source is the tax collected by the seller from the buyer at the time of sale of specified goods.
What is the Due date for payment in case of non-government taxpayer?
When the Tax is to be deposited for months other than March, it is 7th of the next month.
When the Tax is to be deposited for the month of March, then it is 30th April.
What is the Due date for payment in case of government taxpayer?
When the Tax is Deposited without challan, then it is on the Same day
When the Tax is deposited with challan, then it is on 7th of the next month.