Two possible situations: "The teacher asks the STUDENT to hand in his/her TESTS." or the other situations is "The teacher asks the STUDENTS to hand in their TESTS."

I would say "Please hand in your tests now".

The teacher would ask them to hand in their TESTS. You need a plural form here, because what you really mean by 'tests' in this sentence is 'test papers'. 'Tests' here refers to the physical pieces of paper involved, so these should obviously be in the plural. This is different from saying, for example, 'All the students are taking a test tomorrow.' Here we use a singular form, because they are all taking the same test.