Self Assessment under Sec 140A of the Income Tax Act, 1961

Ritik Chopra | Last updated: 01 November 2021

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Quick Summary

Section 140A of the Income Tax Act, 1961, outlines the process of self-assessment for taxpayers. Before submitting your income tax return, you must calculate and pay any tax due, considering taxes already paid, deducted at source, and any eligible reliefs. This self-assessed tax, along with any applicable interest for delays, must be deposited before filing your return, and will be adjusted against your final tax liability.

In this article we will discuss about the self assessment under section 140A of the Income Tax Act.

Every assessee liable to pay income tax is required to submit his return u/s 139, 142, 148 or u/s 153A. The assessee should prepare his return after taking into account following points:

(i) The amount of tax, if any, already paid under any provision of this Act.

(ii) Any tax deducted or collected at source.

(iia) Any relief of tax claimed under section 89.

(iii) Any relief of tax or deduction of tax claimed u/s 90 or 91 on account of tax paid in a country outside India.

(iv) Any relief of tax claimed u/s 90A in account of tax paid in any specified territory outside India referred to in that section.

(v) Any tax credit (MAT) claimed to be set off in accordance with the provision of Section 115JAA

(vi) Any tax credit (AMT) claimed to be set off in accordance with the provisions of Section 115 JD.

Interest payable u/s 234A shall be computed on the amount of tax on the total income as declared in the return as reduced by the amount of:

(a) Advance tax, if any, paid.

(b) Any tax deducted or collected at source.

(ba) Any relief of tax claimed under section 89.

(c) Any relief of tax or deduction of tax claimed u/s 90 or 91 (Double Taxation Relief) on account of tax paid in a country outside India.

(d) Any relief of tax claimed u/s 90 A on account of tax paid in any specified territory outside India.

(e) Any tax credit claimed to be set off in accordance with the provision of section 115JAA or section 115JD.

Self Assessment Tax Under Section 140A: Your Guide

Tax calculated under self assessment is required to be deposited by the assessee before submitting a return of income. The tax so paid shall be adjusted towards the tax liability as ascertained on regular assessment. The assessee shall be liable to pay such tax together with interest payable under any provision of this Act for any delay in furnishing the return, or any default or delay in payment of advance tax before furnishing the return.

The amount of interest u/s 234A is to be calculated on the amount of the income as declared in the return as reduced by any amount of advance tax or tax collected at source.

But us 234B interest will be calculated on an amount equal to the assessed tax or as the case may be on the amount by which the advance tax paid falls short of assessed tax.

Assessed tax means the tax on the total income as declared in the return as reduced by tax deducted or collected at source, any relief of tax claimed u/s 89, any relief of tax or deduction of tax u/s 90, 91 and 90A and any tax credit claimed to be set off u/s 115JAA

In case the amount falls short of the aggregate of the tax and interest, the amount so paid shall be first adjusted against interest payable and balance shall be adjusted against tax payable.

In case assessee fails to pay the whole or any part of such tax or interest or both in accordance with the provisions of this section, he shall be deemed to be assessee-in-default in respect of the amount not paid by assessee.

FAQ :

Self-assessment under Section 140A requires taxpayers to calculate and pay any income tax due before submitting their return, taking into account taxes already paid, deducted at source, and claimed reliefs.

When calculating self-assessment tax, you should consider tax already paid, tax deducted or collected at source, and any relief claimed under sections 89, 90, 90A, 91, 115JAA, or 115JD.

The tax calculated under self-assessment must be deposited by the assessee before submitting their return of income.

Interest under Section 234A is calculated on the total income declared in the return, reduced by advance tax paid, tax deducted at source, and certain claimed reliefs. Interest under Section 234B is calculated on the assessed tax or the shortfall in advance tax paid.

If an assessee fails to pay the whole or any part of the required tax or interest, they will be deemed to be an assessee-in-default for the unpaid amount.