FORM 16: All you need to know

Form 16 is the document or certificate or that employers in India issue to their salaried employees as proof of Tax Deduction at Source or TDS. The salaried personnel can then submit the forms while filing Income Tax Returns in India.

For the benefit of our readers, here are some more insights into Form 16

  • Form 16 supports an employee, as his proof of income, in case of IT scrutiny
  • If the employee’s income is below Taxable limit, employer may not issue Form 16
  • Tax Deduction at Source (TDS) Certificate issued to salaried employees
  • It is also proof of the salary employees receive
  • Contains details of tax paid by Employer on behalf of the Employee
  • If Employer deducts TDS, the responsibility to issue it to the employees lies with him
  • Corrections can be made on a Form 16
  • Only those employers with TAN (Tax Deduction Account Number) can deduct TDS, and issue a Form 16

 

To understand Form 16, let us now see what the components of Form 16 are;

  • The personal details of the employee, like name, Permanent Account Number (PAN) etc.
  • The employer details, name, PAN, Tax deduction and collection Account Number (TAN), etc.
  • An acknowledgement number of the taxes paid by the employer.
  • Details of the salary; Gross salary, net salary, deductions, perks etc.
  • Total income and tax deductions.
  • Education cess and surcharge details.
  • Taxes deducted as per sections 191A.
  • Declaration of tax payments from the employer.
  • Refunds in any to the employee, or balance of taxes payable by the employee.
  • Receipt of the TDS paid.
  • All details of the Tax Payment, like Challan number, cheque number, Demand Draft number etc.

 

Form 16 generally consists of two parts. Part A and Part B; this table explains better.

 

FORM 16  – Part A FORM 16 – Part B
TDS deducted by the employer Employee’s taxable salary income
PAN of the employee TDS by employer
PAN of the employer Break up of deductions under sec 80 C
Employee Name and Address Aggregate of Sec 80 C with gross amount
Employer Name and Address Tax refund details if any.

 

Generally, it is the employer’s responsibility to provide the employee, with the Form 16; Form 16 can however be downloaded from the internet by following these simple steps;

 

  • Log in using your credentials
  • Go to downloads tab
  • Select Form 16
  • For individual PAN numbers, select the relevant financial year
  • Enter PAN number and click on the option ADD
  • Go to Proceed option
  • Click on submit to download Form 16

 

 

For the benefit of our readers, given below are the steps to fill in Form 16.

Under Part –A, fill up the following details;

  • Name and address of the Employer: Will be the employer details.
  • Name and designation of the Employee: Will be the employee details as per company records.
  • PAN of the deductor: Permanent Account Number of the Employer.
  • TAN of the deductor: Tax deduction and collection Account Number of the Employer.
  • PAN of the employee: employee’s Permanent Account Number.
  • CIT (TDS): This is the Income Tax Commissioner’s office details.
  • Assessment year and period: Is the current financial year and financial year beginning 1st April and ending 31st March.
  • Summary of the quarters mentioned the company.

    

    Under Part – B, fill up the following details;

 

  • Gross salary which will be your salary without any deductions plus any prerequisites that you receive.
  • Allowance that the company pays you, like travel allowance, house rent allowance etc.
  • The total income chargeable under salaries.
  • Gross total income will be the amount on which your taxes will be calculated.

 

Form 16 – Frequently Asked Questions

Questions Answers
How to get Form 16? Form 16 is generally issued by the employer at the end of a financial year.
When is Form 16 required? Form 16 is generally required when you file your IT returns for the financial year.
Can an employee, request for Form 16s for previous years? Yes he can. By placing a request with the employer, whom he has worked for.
What is the difference between Form 16 and Form 16 A Form 16 is used for TDS certification on salary only whereas Form 16 A can be used on any other source of income apart for salary as well
What is Form 26 AS? Form 26 AS has details about the tax that has been deducted and deposited with the government on your behalf by deductors (banks, employers, etc.)