Pay-Later: Exciting Feature Addition to Income Tax e-Filing Website

The income tax department has added a new feature to the income tax e-filing website. This feature lets people put off paying their income taxes for later. So now, they can file their Income Tax Returns (ITR) without paying their overdue taxes first. 

After they file the ITR, they can pay the taxes they owe, but there are some rules. Before, they had to pay taxes before filing the ITR. The income tax system is changing, with new features from the Indian Income Tax Department aimed at improving the taxpayer's journey. 

One standout feature is the 'Pay Later' option on the e-filing portal. This allows people to file Income Tax Returns (ITRs) without rushing to pay their taxes upfront. This article explores the details of this feature, covering its how to use it properly.

Understanding the 'Pay Later' Feature:

The 'Pay Later' choice lets you file your Income Tax Return (ITR) without immediately paying your outstanding tax dues. However, there are some important things to know about this:

Which Taxes: You can only delay the payment of self-assessment tax using the ‘Pay Later option. Taxes like advance tax and TDS cannot be put off this way.

What Happens: If you choose 'Pay Later,' you might be seen as someone who hasn't paid on time. This could result in penalties and interest on the tax you owe.

After Filing: Once your ITR is processed, you'll get a notice about the remaining tax to pay. If you clear it within 30 days, you won't face extra interest. But there's a debate – some experts think the interest begins from when you chose 'Pay Later.'

Best Time: Though the tax department doesn't give a set time, experts suggest paying within the same month as filing to avoid extra interest charges.

How to Use the Pay Later Option:

Following these steps will help you easily take advantage of the Pay Later feature:

Step 1: Go to the official income tax filing website: https://www.incometax.gov.in/iec/foportal/ and log in using your PAN or Aadhaar number along with your password.

Step 2: Once logged in, choose 'e-file,' then 'income tax return,' and click on 'file income tax return.'

Step 3: Complete the process of filing your ITR, including verifying your personal details, income information, and deductions.

Step 4: While entering your income and deductions, the website will calculate any extra taxes you need to pay. Double-check the total tax amount related to your ITR.

Step 5: A summary will show the precise amount of income tax that you owe.

Step 6: Now, you have a choice between 'Pay Later' and 'Pay Now.'

Step 7: If you want to delay tax payment, select the 'Pay Later' option. This way, you can file your ITR without paying the taxes right away.

Step 8: After picking 'Pay Later,' go ahead and file your ITR, making sure to verify it using any of the provided methods.

Ways to Pay Taxes Later:

Once you've used the 'Pay Later option to file your ITR, there are two ways to clear your income tax:

1. Using the e-Pay Tax Method: After successfully filing, head to the e-Pay Tax section to pay any due taxes. There might not be any extra interest if you pay before getting a tax demand notice.

2. Paying After Getting a Tax Demand Notice: If your ITR is processed and you receive a tax demand notice, you can pick from two methods:

   a. Self-Assessment Tax: Pay your income tax dues on the portal before receiving a notice. This works well if your ITR needs correction.

   b. Tax on Regular Assessment: When you get a notice, follow its instructions for paying taxes. Not doing so could lead to fines and interest.

Conclusion 

Wrapping up it, the ‘Pay Later feature found on the income tax e-filing portal presents people with a versatile approach to filing ITRs without the need to instantly clear self-assessment taxes. 

Although it carries specific terms and possible outcomes, comprehending its application and effects can aid taxpayers in successfully maneuvering through the procedure. 

Through prudent use of this feature and timely settling of tax obligations, taxpayers can sidestep fines, leading to a more seamless tax-filing journey.

Also Read: CBDT Notifies Rule For Determination of Value of "perquisite" in respect of residential accommodation

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