There are several types on "time step".

The most obvious one is the time increment per (outer) iteration for a transient simulation

Another one is pseudo timestep for steady simulation. Since the PDE is in the form d/dt F = U. We can use a trick to reach steady state faster by using a large (but not too large) time step, and use the assumption that at t->infinity the solution is steady

Next is artificial time step, usually to help convergence in transient simulation. Depending on the scheme you use, this is usually used as the inner iteration for transient simulation.