Form 16: Key Details And How To Access Your TDS Certificate

Tue, 11 Jun 2024 10:27:45 IST

For salaried employees in India, Form 16 is an essential document for filing income tax returns. Both employers and employees must be familiar with its components, eligibility criteria, and significance to ensure compliance with tax regulations.

What is Form 16?
Form 16 is a certificate of Tax Deducted at Source (TDS) that reflects the salary earned and the amount of TDS deducted during the financial year. Employers issue this form by June 15th of each year for the previous financial year. If you have worked for multiple employers in a year, you should receive a Form 16 from each one.

This form is crucial for salaried individuals when filing their income tax returns and comprises two parts: Part A and Part B.

Part A of Form 16
Part A contains the details of TDS deducted and deposited quarterly, as well as the PAN and TAN of the employer. Employers can generate and download this part from the TRACES portal (https://www.tdscpc.gov.in/app/login.xhtml) and must verify its accuracy before issuance. If you have changed jobs during the financial year, each employer will provide a separate Part A for their period of employment. Key components include:

Employer's name and address
Employer's TAN and PAN
Employee's PAN
Quarterly summary of salary payments
Quarterly summary of tax deducted and deposited

Part B of Form 16
Part B is an annexure to Part A, prepared by the employer, detailing the salary breakup and deductions allowed under Chapter VI-A of the Income Tax Act. If you switch jobs, obtain Form 16 from all employers. Important elements include:

Detailed salary breakup
Exempted allowances under Section 10
Deductions under various sections like 80C, 80D, 80E, etc.
Tax calculations, including surcharges and cess
Relief under section 89

Availability of Form 16 for FY 2023-24

Form 16 for the financial year 2023-24 will be available by June 15, 2024. If TDS was deducted from your salary between April 2023 and March 2024, your employer must issue Form 16 by this date. In case of loss, you can request a duplicate from your employer.

Eligibility for Form 16

Every salaried individual whose income falls within the taxable bracket is eligible for Form 16. If an employee's income does not meet the taxable threshold, TDS is not deducted, and hence Form 16 is not required. However, many employers provide it regardless, as it offers a comprehensive summary of earnings and other benefits.

Importance of Form 16

Form 16 serves multiple purposes:

It acts as proof that the government has received the tax deducted by your employer.
It aids in filing your income tax return .
It serves as proof of salary income.
Financial institutions often require it for loan applications.

Employers must provide Form 16 by June 15th. Delays or failures in issuing it can result in a penalty of Rs. 100 per day until the form is issued.

How to Download Form 16

Employers can download Form 16 from the TRACES website. The steps are as follows:

Visit the TRACES website.
Log in with your PAN card number and password, or register if you are a new user.
Go to the ‘Downloads’ tab and select ‘Form 16.’
Choose the form type and the relevant financial year.
Verify PAN and other details.
Enter the TDS receipt number and the date of TDS deduction.
Add the total tax deducted and collected.
Submit the request and download the form once available.
Using Form 16 for Filing Returns

When filing your income tax return for FY 2023-24 (AY 2024-25), use Form 16 to locate:

Exempt allowances under Section 10
Salary deductions under Section 16
Taxable salary
Income from house property
Income from other sources
Section 80C deductions
Total deductions under Section 80C
Tax payable or refund due

Additionally, verify employer details like TDS deducted, TAN, PAN, name, and address.

Verifying Form 16 Details

Upon receiving Form 16, verify all details, including income and TDS deducted. If there are discrepancies, contact your HR/Payroll/Finance department for corrections. The employer will file a revised TDS return and issue an updated Form 16.

Simplified Tax Filing with Form 16

Our software can automatically extract information from your Form 16 to prepare your tax return, eliminating the need for manual data entry.