What is Form 16?

If you’re a salaried employee, you must have heard about the term TDS. It basically stands for Tax Deducted at Source. If your salary is eligible for a TDS deduction,  you will come across the form 16 at some point in your career.  Form 16 is essentially a certificate issued by an employer to the employee confirming the deduction of TDS on salary and payment of the same to the authorities on behalf of the employee.  The Employees are supposed to receive the form on an annual basis from the employer.

In order to file Income Tax Returns in India, Form 16 is one of the pre-requisites and it helps vastly simplify the return filing procedure.

Form 16 consists of Two Parts: Part A and Part B. As mentioned before, form 16 is issued is issued annually, on or before 15th June of the next year, following the financial year in which tax is deducted.

Form 16 comes under Section 203 of the income tax act and is also known as the Salary TDS Certificate, Part A of this form serves as the proof tax paid.

Form 16: Part A

The part A of form 16 serves as a proof of the tax paid by the individual during the financial year. The part A of the form is generated through the TRACES Portal, by the employer. Taxpayers and PAO (Pay and Accounts Office) can also look at and generate the form.

Form 16

Traces Portal Homepage

If in case you change jobs in one financial year,  all employers will issue separate Part A of Form 16, for the period of employment. The components of Part A of Form 16 are :

  •  Certificate Number
  • Name And Address of Employer
  • Name and Address of Employee
  • PAN, TAN of Deductor
  • PAN of Employee
  • Employee Reference Number  (if Provided)
  •  Commissioner of Income Tax (TDS) Address. The deductor shall furnish the address of the Commissioner of Income-tax (TDS) having jurisdiction as regards TDS statements of the assessee.
  • Assessment Year and Time of Employment with the organization
  • Summary of the amount paid/credited and tax deducted at source thereon in respect of the employee
  •  Details of Tax Deducted and Deposited in the Central Government account through book adjustment
  •  Details of Tax Deducted and Deposited in the Central Government Account through Challan

Form 16 Part B

The part B of form 16 is essentially the Annexure of Part 1. If in case you change employment(s) in one financial year it is completely your choice if you want to obtain the part b of the certificate from all the employers or only from the last employer. The components of part B of Form 16 are as follows:

  • Taxable salary of the employee
  • Applicable Tax Deductions and Exemptions under Section 80 C (Tax Saving Investments) and other investment schemes under sections 80 CCC, 80 CCD, 80 D, 80E, 80G
  • The aggregate of all deductions reduced from the taxable  income
  • Education Cess and surcharge details
  • Total tax payable and amount of TDS deducted by the employer
  • Gross total Income, which  will be the final amount on the basis of which taxes will be calculated
  • Tax Payable or Refund Due

Form 16: How to Download?

The certificate enclosed within form 16 is generally issued by the employer to the employee. The form reflects the total earnings and the taxes applicable. You can download the form online website of the Income Tax Department as well. The form is available in PDF format.

As mentioned above, it is the responsibility of the employers to give the form to the employee. However, due to some reason, you do not have the form you can download it from the Income Tax Department Website which will lead you to the TRACES portal

Step 1: Head on over to the TRACES Portal

Step 2: Select the type of entity to be a Taxpayer

Step 3: Login using your credentials

Step 4: Go to the Downloads

Step 5: Select Form 16/ Form 16 A

Step 6: Enter PAN and other relevant details and Click GO to download

Form 16 v Form 16A

Form 16 also known as salary TDS certificate is issued by the employer. However, in addition, to his, there is another Form, form  16A  that is applicable as a TDS on income on other than salary. The Form 16A is very similar to the form 16 with details such as PAN, TAN and the TDS deducted on incomes other than salary.

Purposes of Form 16

  • Income Tax Returns – IThe form is primarily used to File ITR in India.  The form contains all the details with regards to the income and hence becomes an essential document for ITR filing.
  • Verification – Form 16 can be used to verify the TDS deductor by the employer and the actual income tax collected by the Government. TDS deductions made available in form 16 and the 16A can be cross-verified using the actuals in the 26AS Form.

The amount in the forms 16 and 16 A should match up with the actual deposited account with the government furnished in the 26AS form

Form 16 PDF

 

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