How to use a Current Account for tax payments?

When managing your finances, a Current Account is an essential tool to make your financial transactions seamless and efficient. Apart from facilitating day-to-day banking activities, did you know that your Current Account can also be used for tax payments?

 Choosing the best bank to open a Current Account

 To begin utilising your Current Account for tax payments, selecting the right bank to open an account with is essential. Look for a bank that offers robust online banking facilities, excellent customer service, and a user-friendly interface. Most reputable banks in India provide reliable Current Accounts with seamless online banking services.

Documents required for opening a Current Account

Before diving into tax payments, let’s address the necessary documents required for opening Current Account. While specific requirements may vary depending on the bank and the type of current account you want to open, the following are the generally requested documents: 

  • Identity proof: Aadhaar card, PAN card, voter ID, or passport
  • Address proof: Utility bills (electricity, water, gas), bank statements, or rental agreement
  • Business proof: Certificate of incorporation (for companies), partnership deed (for partnerships), or proprietorship declaration (for sole proprietors)
  • Recent passport-sized photographs
  • KYC (Know Your Customer) documents: These may include duly filled application forms, business registration documents, and the KYC form provided by the bank 

Understanding the process of tax payments 

Now that you have your Current Account open and ready, let’s explore the step-by-step process of using it to pay your taxes: 

Linking your PAN: Ensure that your PAN is linked to your bank account. You can do this by providing your PAN details to the bank and filling out the necessary forms or updating them through their online banking portal if the online option is available.

 Enrol for online tax payment: Visit the income tax department’s official website or the government’s e-filing portal and register for online tax payment services. You may need to provide your PAN, email address, and other essential details during registration.

 Select the appropriate tax payment method: Once registered, choose the tax payment option that suits your requirements. You can pay your taxes online through net banking, debit card, or mobile banking applications. Select your Current Account as the payment source.

 Fill in the required details: Enter the relevant tax details, such as the assessment year, tax amount, and type of tax you are paying (e.g., income tax, goods and services tax, etc.). Verify the information before proceeding.

Authorise the transaction: Once you have reviewed the payment details, authorise the transaction using the provided authentication method. This may involve entering a One-Time Password (OTP) or using a digital signature.

Confirmation and acknowledgement: You will receive a confirmation message or an acknowledgement receipt after successfully completing the payment. Save this for future reference and record-keeping.

 To wrap up 

By leveraging the power of your Current Account, you can simplify the process of paying taxes in India. By utilising your Current Account for tax payments, you save time and contribute to building a more digitally advanced financial ecosystem. Embrace the convenience of online banking and empower yourself to navigate tax obligations effortlessly.