Keep away from utilizing bank card to pay tax on new e-filing portal. Here is why



Keep away from utilizing bank card to pay tax on new e-filing portal. Here is why&nbsp

Key Highlights

  • Failing to repay all the bank card invoice by the due date will incur finance expenses on the unpaid invoice

  • You must pay a 1% penalty on the tax due in case you miss the advance tax cost and one other 1% in case you miss the deadline for submitting revenue tax

  • Failing to repay all the bank card invoice by the due date will incur finance expenses on the unpaid invoice

New Delhi: The Central Board of Direct Taxes (CBDT) lately launched the brand new revenue tax return e-filing portal. The brand new web site has many options which can make it simpler for taxpayers to file their returns. One of many options of the brand new portal is the addition of various cost choices. 

Taxpayers will have the ability to pay tax by way of netbanking, UPI (Unified Funds Interface), RTGS (Actual-Time Gross Settlement), NEFT (Nationwide Digital Funds Switch) and even bank cards. Notice that till now, taxpayers had the choice to pay solely by way of netbanking of huge non-public and public sector banks. Even most small non-public sector banks or international and cooperative banks weren’t a part of it. The added choices will make it simpler for taxpayers to file returns.

It’s no secret that for a lot of taxpayers, it was tough to make cost on-line by way of web banking since their banks weren’t a part of the I-T division’s system. As per chartered accountants, some purchasers even checked if they might switch the cash to them and whether or not they will pay on shopper’s behalf. With extra cost choices, particularly bank cards, will probably be extra handy for taxpayers to pay tax.

Whereas bank card will now be one of many choices for cost, consultants advise taxpayers to make use of it as final resort. Bank card invoice cost is a vital monetary job and failing to take action may end up in excessive curiosity, debt lure and low credit score rating. If you happen to plan to utilizing a bank card to pay tax, make sure that you repay on time. 

Not paying bank card payments on time has severe penalties. Other than impacting your credit score rating, delaying bank card cost will end in you paying a late price. Your subsequent billing assertion will even embrace a price for late or missed funds. Additionally, in case your cost is late each month, you can be charged a late price cost or lower than the minimal cost.

Additionally, do not forget that it’s important to pay a 1% penalty on the tax due in case you miss the advance tax cost and one other 1% in case you miss the deadline for submitting revenue tax. Often, taxpayers can file belated returns till 31 December. This yr, the deadline for late returns has been prolonged by a month. If a taxpayer finally ends up revolving bank card excellent, the curiosity expenses will likely be far increased.

Failing to repay all the bank card invoice by the due date will incur finance expenses on the unpaid invoice. The costs normally vary between 30-49% each year on the unpaid bank card invoice. Non-payment of all the bank card invoice may result in the revocation of the interest-free interval on contemporary bank card transactions. 

Moreover, the finance expenses or the annual proportion fee on bank cards are sometimes upwards of three% a month. In some circumstances, it will possibly even be as excessive as 4%. Whereas the federal government solely expenses easy curiosity on the tax due, bank card issuers cost curiosity on curiosity (compound curiosity).

As an example, in case you pay Rs 50,000 as tax utilizing a bank card and may repay solely 25,000 every month, you’ll find yourself paying Rs 2,364 in finance price over a interval of three months. Additionally, GST will likely be charged on the curiosity as nicely. The federal government, however, expenses easy curiosity on the excellent quantity which means in case you delay paying Rs 50,000 for 3 months, a penalty of 1% will likely be levied every month and you’ll find yourself paying Rs 1,500.

Whereas the brand new e-filing portal will supply bank card cost facility, use your bank card to pay tax provided that you may repay the issuer earlier than the due date.



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