No, 'Tot ziens' is more formal than 'See you later'. It's the equivalent of the German 'Auf Wiedersehen', the French 'Au revoir' and the English 'Goodbye'.
'See you later' is usually translated to 'Zie je later' (literally), or simply 'Later'. Young people in the Netherlands (those who aren't yet in their thirties) will sometimes use the untranslated 'See you later' because it sounds 'cool'.
I think making a distinction here is quite artificial. I mean, you can rate these greetings on a scale from more to less formal, but trying to match them 1:1 to their equivalents in other languages is quite tedious (and inconsistently marking them right or wrong doesn't help).
Maybe you are right, but since Duolingo accepts one or two possible answers, here I have to use the right ones. In everyday life it is, of course, a different thing, but - and it is my opinion only - one cannot learn a living language properly through a computer, without interactions with other peoples. Sites, like Duolingo can give one a strong base for a foreign language, but if one wants to learn a language really well, one has to spend some time amongst native people of that language. So I asked this for the sake of XPs and hearts. But thanks for your thoughts! :)