Overview of OLTAS

Published On - March 15, 2016

admin Income Tax, Online Tax Accounting System

OLTAS stands for Online Tax Accounting System. It is a system mainly used in the collection of direct taxes from relevant individuals as well as companies or organisations. It is the Income Tax Department’s strategy to acquire information as well as to keep a record of all the tax that has been paid via banks through the uploading of the details of the challan online.

OLTAS was launched in April 2004 with the following objectives:

  • Collection of online direct taxes
  • Accounting of online direct taxes
  • Reporting of payments as well as receipts of on-line direct taxes

All these objectives are to be carried out through banks and their respective network of branches.

Why Was OLTAS Introduced?

Previously, all government tax collection was carried out manually via banks, which proved to be an extremely long and arduous process that was littered with mistakes and errors. In order to do away with the constraints that hindered the manual method of tax collection, a recommendation was put forth by Dr. Vijay Kelkar (Chairman of the Advisory Group on Tax Reforms) to ensure that the Income Tax Department and the Reserve Bank of India worked in tandem to facilitate the transfer and collection of tax collections and refunds through online means.

To make sure that this process was carried out smoothly the following bodies were tasked with working together to take the procedure to its logical conclusion:

  • The Central Board of Direct Taxes
  • The Indian Banks Association
  • The Controller of Accounts
  • The Reserve Bank of India

OLTAS arose out of this collaboration, while its implementation was carried out in three distinct phases initially. While OLTAS was originally set up to cover only corporate taxpayers, it eventually extended its scope to include both corporate as well as individual taxpayers before finally covering all branches of the 32 member banks all across India.

In it’s original phase, data relating to tax information was the only component included under the scope of the OLTAS Project, but post April 1st 2005, the project was shifted on-line and banks were required to reconcile all tax funds that were collected daily with the data and information that was electronically sent to TIN by the banks.

How Does OLTAS Work?

The Income Tax Department has come up with a specific file format with regards to the uploading of tax payment data. This format is required to be used by all participating banks and their branches when it comes to the generation and transfer of any information or data relating to tax. Following the preparation of the file in the format outlined, the File Validation Utility (FVU) that is provided by the NSDL, can be used to ensure that the structure of the file is correct and proper.

As per OLTAS, the taxpayer will use only a common single copy challan for the following:

  • Challan Number ITNS 280 for corporate taxes as well as regular income tax
  • Challan Number ITNS 281 which is required for depositing all TDS and TCS
  • Challan Number ITNS 282 required for paying the following taxes:
  • Gift Tax
  • Wealth Tax
  • Hotel Receipts Tax
  • Estate Duty
  • Securities Transaction Tax
  • Expenditure Tax
  • Any other direct tax
  • Challan Number ITNS 283, which is required for any taxes relating to fringe benefits or banking cash transactions

The taxpayer will then receive the tear-off section of the challan after the bank has stamped it, which will contain a unique Challan Identification Number (CIN). The CIN contains the below mentioned data:

  • The bank BSR Code, which is a 7 digit number. This code relates to the bank where the taxpayer has made the tax deposit
  • The date the challan was presented
  • The 5 digit serial number of the challan that was presented to the taxpayer by the bank on that particular day

The CIN is required to be entered by the taxpayer in his or her Income Tax Return as evidence of payment of tax, is also required to be cited in case of any future enquiries. The taxpayer can acquire the challans from the official website of the Income Tax Department as well as any of the Tax Offices in his or her locality.

OLTAS Challan Status Enquiry:

The Tax Information Network (TIN) assists taxpayers by providing them with a facility through which they can make inquiries online regarding the status of their challans. This facility ensures that all tax payments are consolidated under the name of the taxpayer and can also be used by banks collecting tax to make inquiries about the status of challans that were uploaded by them.

Taxpayers can check the status of their challans online through the following search tools:

  • CIN Based View: After the taxpayer enters the CIN and the tax amount, he or she will gain access to the following information:
  • The Bank BSR Code
  • The date the deposit was made
  • The serial number of the challan
  • The major head code along with a description
  • The TAN and PAN of the taxpayer
  • The Taxpayer’s name
  • The date the challan was received by TIN
  • If the taxpayer has entered the tax amount, then he or she can also view confirmation of said amount and check whether the amount entered is accurate
  • TAN Based View: If the taxpayer provides the TAN as well as the date range during which the challan was given out by the bank, then he or she will have access to the following information:
  • The Challan Identification Number (CIN)
  • The major head code along with a description
  • The minor head code
  • Details regarding the payment and how it was made

Branches that collect tax as well as nodal branches can also check on the status of challans that have been deposited in banks via the following procedure

  • Branches of Collecting Banks: Branches collecting tax can view the following information by providing the major head code as well as the branch scroll date:
  • The total amount
  • The total number of challans for each major head code
  • The serial number of the challan
  • The date the challan was tendered
  • The TAN and PAN of the taxpayer
  • The Taxpayer’s name
  • The date the challan was received by TIN
  • Nodal Bank Branches: Nodal bank branches can access the following information by using the major head code-description and the nodal scroll date
  • The scroll number of the nodal branch
  • The date of the scroll
  • The major head code along with the description
  • The total tax amount
  • The number of bank branches
  • The number of challans deposited
  • The following data can also be viewed for every Nodal Branch Scroll Number:
  • The Bank BSR Code
  • The scroll number of the branch
  • The scroll date of the branch
  • The total tax amount
  • The total number of challans
  • The date the challan was received by TIN

Benefits Of OLTAS:

The OLTAS scheme comes with a number of benefits that are advantageous to taxpayers from all across the country:

  • OLTAS has replaced the old model, wherein taxpayers were required to fill in four challans, with a model that requires only a single challan.
  • OLTAS has made it easier for taxpayers to acquire their tax payment acknowledgements from their bank branches with minimum fuss
  • Evidence of payment of tax can be verified at once with the help of the Challan Identification Number (CIN)
  • All information and details regarding the taxpayer’s tax payments can be checked online. The taxpayer has to log in to TIN-NSDL and enter the CIN he has received from the bank in order to check his tax details.
  • After the introduction of OLTAS, taxpayers do not have to send in copies of the challan or the acknowledgement along with their tax returns. Only the CIN is required to be mentioned with the tax returns.

Frequently Asked Questions about OLTAS:

1. What does TIN stand for?

TIN is the Tax Information Network that was setup to manage information related to challans and is a conduit between all participating banks and the Taxation Department.

2. What are the modes of direct tax payments that one can make at a bank?

Tax payments can be made by visiting any of the branches of the banks that are authorised under OLTAS. Direct tax payments can be made either by cash, cheque or demand draft. If payment is made in cash, the taxpayer will immediately receive the tear off section of the challan, which will be stamped with the CIN. However, in the case of cheque or demand draft payments, the tear off section of the challan will only be given to the taxpayer following the realisation of the demand draft or cheque.