Self Assessment Tax

Individual needs to make payment of Self-Assessment Tax (SAT) for income from other sources. There is no specified date of payment of the tax. The ideal time is to pay it as soon as possible, without waiting for the tax returns filing date and to avoid payment of interest on the tax amount.

Individuals are expected to do the computation of the final liability of Income Tax after the deduction of TDS amount from the source of income as well as advance tax paid for the financial year. During the completion of Financial Year, if any of the tax is pending to pay before filing of Income Tax return, then the final amount which an individual is liable to pay is Self-assessment tax. 

Why to pay a Self-Assessment Tax?

Self-Assessment Tax usually payable by an individual related to income from other sources. Situation may happen where an individual missed out on an income at the time of giving their advance tax etc. There is a possibility that TDS may not be deducted or partially deducted or deducted at a lesser rate against the higher rate that applies to the Income Tax filing. There are many of the Salaried individuals who are earning a sizeable amount from investments such as short-term bonds or fixed deposits which is not in the knowledge of an employer. So, the extra earning of the employee, in that case, are not considered for deduction by an employer. In that case, salaried individual needs to make payment of Self-Assessment Tax.

Process to pay Self-assessment tax online

  • Log on to the website of the Income Tax Department,
  • After signing in on the website, click on the option of E-Pay taxes.
  • After clicking on the link, you will be redirected to the website of NSDL.
  • Individuals get an option of the ‘’Challan No./ITNS 280’’ followed by “(0021) Income Tax other than companies)”.
  • The person needs to provide details such as PAN Card details, contact details which consist of address, official and residential contact numbers or mobile numbers.
  • Individual need to make selection of appropriate year for assessment that he or she wants to make payment for.
  • After that person needs to select “type of payment”, in that case, code will be “300” for Self-Assessment Tax.
  • The individual can choose the bank from the drop-down menu for making payment.
  • The individual can choose the bank from the drop-down menu for making payment.
  • The individual will be then directed to their bank’s Net banking page to make the payment.
  • After making a successful payment, a challan will be displayed on the screen. It will include CIN, all payment details along with the name of bank to which payment is to be made.
  • It is advisable to keep a hard copy of the same.
  • After paying the Self-Assessment tax, details of the same will be reflected on the individual’s form 26AS. If it does not show, challan details can be given at the time of filing Income Tax returns.

Self-Assessment Tax Calculator

a) If payment made by an individual for the tax before the assessment date, there are two ways to do the calculation of interest which are as follows:

The amount of advance Tax which is not being paid will be the amount considered for computation of interest for the date up to the payment of self-assessment tax.

b) The Advance tax amount after deducting the self-assessment will be considered for computed from the date of payment for self-assessment tax has been made.

Procedure to follow for computation of self-assessment tax are as follows:

Calculate the taxable amount payable on the total income of an individual with the help of Income Tax slabs that are available online.

After that add the interest which is to be payable under Section 234A/234B/234C

Once the amount is added then making a deduction of the relief amount under Section90/90A and 90 from the total amount.

Then further do a subtraction of the MAT Credit amount under Section 115JAA.

Then do a subtraction of advance tax amount.

This will lead to the self-assessment tax payable on the individual’s income tax.