November 26, 2025
5 mins read
At the end of the financial year, you pay your last tax, which is called self-assessment tax. You could call it a "balancing payment". It includes any taxes you still owe after paying your advance tax and TDS (Tax Deducted at Source). You figure out how much you owe and pay it yourself before you file your Income Tax Return (ITR) to make sure your taxes are up to date.
Self-assessment tax is the amount of tax that a person still owes on their income after taking into account any taxes they have already paid for the financial year. It's the last amount you agree on with the tax office. If your TDS, TCS, and advance tax payments weren't enough to cover the full amount of your taxes, you have to pay the difference as self-assessment tax. You don't have to pay this bill by a certain date, but you do have to pay it before you file your Income Tax Return (ITR).
You might be wondering why you have to fill out the Self Assessment tax return if you've already paid TDS and advance tax. The simple answer is that, as per the assessment of the Income Tax department, you are found to be earning additional income that has not come under TDS or advance tax.
Here’s a list of situations where paying a self-assessment tax is necessary
The assessment done to pay advance tax was inaccurate, resulting in the undermining of any additional income.
TDS calculation was not done accurately by evaluating all types of income.
A taxpayer who is a salaried employee might have additional income through investments or trade that did not make it into his income list while determining TDS and advance tax.
These are the situations under which a taxpayer has to pay SAT. Remember that any tax exemption promised through investments and trade is taken into consideration before calculating SAT liability.
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Calculating your self-assessment tax is quite simple. First, you add up all your taxable income from all sources. Then, you calculate the total tax payable on that income for the year. From this total tax amount, you subtract all the taxes you have already paid, like TDS, TCS, and any advance tax instalments. The remaining amount is your self-assessment tax.
For example, if your total tax for the year is ₹50,000, and you've already paid ₹45,000 through TDS and advance tax, your self-assessment tax liability is the remaining ₹5,000.
It is easy to pay your self-assessment tax online. You can use Challan 280 on the official Income Tax Department website to do it.
This is a simple guide that will help you:
Visit the e-Filing Portal: Go to the official Income Tax e-filing site and sign in to your account.
Look for the e-Pay Tax option: Click on "e-Pay Tax" in the "e-File" menu on your dashboard. This will take you to the page where you can pay your taxes.
Make a New Payment: To start, click the "New Payment" button.
Pick the Right Form: You will see different ways to pay your taxes. You need to choose the Income Tax option for self-assessment tax.
Choose the year of assessment: Pick the right Assessment Year for the tax you are paying.
Fill in the tax information: Enter the different parts of your tax payment (Basic Tax, Surcharge, Cess, etc.) and click "Continue."
Pick a way to pay: You can pay with your bank's Net Banking, a debit card, or other ways like UPI.
Finish the Payment: You will be taken to your bank's website to finish the transaction. You will get a challan receipt once the payment goes through.
Store the Challan: Be sure to download and keep a copy of this challan. It shows that you paid your taxes, and you will need the information from it when you file your ITR.
Now that you have understood the concept of Self Assessment Tax, you have a clear picture that it is a mandatory tax that has to be paid before filing income tax returns for the financial year. In case you have failed to pay the SAT or have miscalculated your SAT, the income tax returns you file will be declared defective, leading to multiple tax complications and penalties.
You can refer to section 139 (9) of the Income Tax Act, to examine the provision carefully.
Advance tax is different from a self assessment tax as the former talks about an advance payment done against your tax liabilities allowing you to pay as you earn to avoid the burden of making a big payment at once. Apart from the fundamental difference, an SAT differs from an advanced tax in multiple other ways. Take a look at the table for a clear understanding:
Basis of Comparison | Advance Tax | Self Assessment Tax |
Meaning | Advance tax is the tax paid in advance against the yearly tax liability instead of paying a huge amount on a fixed date. | Self assessment tax is the liability on a taxpayer after deducting TDS/TCS and advance tax. |
Due Date | The due date for paying an advance tax is not fixed and varies depending on the amount payable. | There is no due date for paying SAT. However, it needs to be done before filing the income tax return. |
Who is liable to Pay? | Any person with an income who has a tax liability of more than ₹10,000 in one financial year. | Any person who has an additional income that has not been taxed under TDS or advance tax. |
Amount of Tax Payable | The amount payable is not fixed as it depends on the income. | Amount payable can be determined using the formula:[{B+C) – (D+E+F+G}]. |
If you live in India and pay taxes, you are responsible for making sure they are all paid on time and correctly. The final step in this process is very important: self-assessment tax. It makes sure that any extra money you made that wasn't covered by TDS or advance tax is taxed correctly. The official tax portal makes it easy to pay your taxes online. Paying your self-assessment tax correctly and on time will help you avoid fines and stay within the law.
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To assess whether you need to file for an SAT return, you have to evaluate your income from all sources and check whether there is an additional income that has not been taxed under TDS/TCS or an advance tax.
Unlike a TDS, there is no specific date or deadline to submit a self-assessment tax return. However, it is mandatory to submit a SAT return before filing for the next Income tax return.
Visit the official website of the Income Tax Department and log in to your profile to find the e-filing window. From here, you will be redirected to the NSDL website which gives you the option of choosing SAT as a type of payment. Select the option, choose the financial year for which you want to file SAT and make the payment.
For SAT purposes, you must keep all your income and tax documents including business records, payee records, invoices, ITR receipts of the previous year etc.
Yes, you can claim expenses against self assessment tax including medical, educational, investment or other such expenses.
Submitting your SAT return is mandatory to file your ITR. In case, you are liable to file a self-assessment tax return and you have made a calculation mistake or failed to submit an SAT return, your income tax return will be declared defective.
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