Self Assessment Tax : How to Pay Online & Calculation

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Self Assessment Tax : How to Pay Online & Calculation

Tax paid by citizens is one of the government's significant sources of income, which it uses for various development projects and schemes. The government collects taxes in three ways, which includes advance tax, tax deducted at source, and self-assessment tax.

Individuals must calculate their final income after deducting TDS and advance tax and pay it to the government. Let us explore self-assessment in income tax, who should pay it, and how it can be paid.

What is Self-Assessment in Tax & Who Should Pay Self Assessment Tax?

Self-assessment tax is a tax an individual pays on the excess income after deducting TDS and advance tax in a financial year. Individuals must compute their final liability and arrive at an amount for tax calculation. Those individuals whose income is above the threshold limit are liable to pay self-assessment tax in advance.

  • Self-assessment tax must be paid in the following cases:

  • If you have missed out on including an income while paying the final advance tax.

  • If the TDS at source is done at a lower rate or is not deducted at all.

  • Salaried individuals who have not disclosed their income from other sources to the employer.

  • One can file self-assessment tax by filling out the self-assessment tax challan 280. It is important to note that there is no deadline for paying self-assessment tax. However, individuals must pay the self-assessment tax before filing income tax returns to avoid paying interest.

How to Calculate Self-Assessment Tax?

Here are the steps to arrive at the amount for self-assessment tax in India:

  • Add the income from all sources like salary, interest, profession, business profit, capital gains, etc.

  • Reduce all the allowed deductions and exemptions under different sections, such as sections 80D, 80C, etc.

  • Arrive at the tax according to the slab rates.

  • Use the following formula to arrive at the self-assessment amount

  • [(A+B)- (C+D+E+F+G)]= Self-assessment tax amount

  • A= Total tax

  • B= Interest according to section 234A,234B, 234C

  • C=Tax Relief under sections 90, 90A,91

  • D=MAT credit under section 115JAA

  • E= TDS/TCS

  • F=Advance tax

  • G= Advance tax

How to Pay Self-Assessment Tax Online?

  • Login to the Income tax e-filing portal

  • Navigate to the “e-File tab” and select “e-pay tax” from the options.

  • On the next screen, click look for the “New Payment” option on the right corner.

  • Select “Income Tax” from the list of options on the page. Then click “Proceed.”

  • From the dropdown menu, choose “Assessment Year” and then select “Self-assessment tax 300.” Continue to the next screen.

  • Fill in the tax amounts on the page.

  • Choose the bank through which you wish to make the transaction and complete the payment.

  • After the payment is complete, download the challan by clicking the download option.

What Happens If You Pay Wrong Self Assessment Tax?

If you make a wrong self-assessment of the income and the tax payable, the return will be considered defective. The provisions of the Income Tax Act of 1961 allow taxpayers to make changes and sort the return within 15 days of filing. If the taxpayer does not make the necessary changes, the return will be declared defective.

Advance Tax vs Self Assessment Tax

Advance tax and self-assessment tax are both paid to the government according to the provisions of the Income Tax Act 1961. Both these types of taxes are liabilities for the taxpayer. However, they differ from each other in the following ways:

Basis Advance Tax Self-Assessment Tax
What is the definition? Advance tax is part of the tax that is paid in instalments during a financial year. It is the tax paid by the assessee on the assessed income after deducting advance tax and TDS.
Due Date The due date for paying advance tax is on different dates, i.e., 15th June, 15th September, 15th December, and 15th March. SAT does not have a specified payment date. However, it must be paid before filing the return.
Amount of Tax  Tax payable is different for individuals and companies. The self-assessment tax amount is calculated using a formula.
Who is the payer? Salaried and self-employed individuals who have a tax liability of more than 10,000 must pay advance tax. Individuals must pay self-assessment tax.


All salaried individuals are required to pay self-assessment tax online as per the provisions of the Income Tax Act of 1961. This process involves a few straightforward steps that assist taxpayers in complying with the Act's requirements and fulfilling their obligations.

Individuals can claim a deduction in tax for the premium paid for medical insurance while calculating the self-assessment tax. It helps to reduce tax liability and secure the health of the taxpayer and their families.

What is the Importance of Health Insurance Plan

Calculation and payment of self-assessment tax in India enable taxpayers to fulfil their obligation towards the government. Apart from the obligation towards the government, an individual also has a responsibility to ensure his well-being and that of his family’s.

This obligation can be fulfilled by purchasing medical insurance in India. A reputed and trustworthy provider like Tata AIG offers plenty of affordable and beneficial insurance plans. Tata AIG also provides health insurance for senior citizens who are above 61 years. It offers critical illness cover, annual health check-ups, and many more benefits.

Tata AIG's health plans cover end-to-end medical expenses and assist you with top-class medical facilities in times of health emergency.

Disclaimer / TnC

Your policy is subjected to terms and conditions & inclusions and exclusions mentioned in your policy wording. Please go through the documents carefully.

Related Articles

What is Form 26AS?

What is Form 26AS?


Form 26AS contains all the complete details of the tax paid by taxpayers during the financial year. It can be used to check all the details of the tax payment and to claim the credit at the time of filing ITR.

Can the self-assessment tax be paid in instalments ?


Yes, self-assessment tax can be paid in instalments. However, it must be paid fully before filing the ITR.