Voluntary payment by persons into various designated Banks. For example Advance Tax and Self Assessment Tax
Taxes Deducted at Source (TDS) from the payments receivable by the tax payer
Taxes collected at source (TCS) at the time of spending.
It is the constitutional obligation of every person earning income to compute his income and pay taxes correctly.The rates of income tax and corporate taxes are available in the Finance Bill commonly called budget, passed by Parliament every year.
Generally the tax on income accumulates only on completion of the previous year. However for simplicity and easiness of collection and regularity of flow of funds to the Government for its various activities, the Income tax Act has laid down payment of taxes in advance during the year of earning itself. Taxes may also be collected during the previous year itself through TDS and TCS. If at the time of filing of return some balance tax to be paid after taking into account the advance tax, TDS & TCS, the short fall is to be deposited as Self Assessment Tax.
The procedure for depositing tax is a quite a simple procedure. A form called Challan available in the Income Tax department, banks and on the IT department web-site are filled up and deposited in the bank along with the money. Taxes can also be paid on-line.
Under the Income Tax Act, every person has the responsibility to correctly compute and pay his taxes. Where the Department finds that there has been underestimation of income and tax due, it takes measures to compute the actual tax amount that should have been paid. This demand of balance tax is called Regular Tax. The regular tax has to be paid within 30 days of receipt of the notice of demand.
