23 Aug 2018: All you need to know about your Form 16
As a salaried person, you must have heard the term 'Form 16'.
It basically serves as a certificate issued by your employer that your Tax Deducted at Source (TDS) has been accounted for from your salary and deposited with income tax authorities on your behalf.
Your employer is required to issue you Form 16 annually, on or before 15th June of the year following the financial year in which TDS was deducted.
Part A: How can you read your Form 16- Part A
Form 16 is split into two parts - Part A and Part B. Let's decode the Part A first.
Part A of the form is generated and downloaded by your employer from the TRACES portal of the Income tax Department.
It contains the name and address of both employer and employee, PAN and TAN of employer, PAN of employee and a summary of TDS.
Part B: How can you read your Form 16 - Part B
Part B of Form 16 is nothing but an annexure to Part A.
It contains the following details:
Your salary break-up, any other income declared by you, relief under Section 8, deductions claimed under Chapter VI A, your TDS and the Net Income tax payable by you.
Issuance: From where can you collect your Form 16?
You can collect your Form 16 from your employer. The issuance of Form 16 becomes mandatory for your employer if he has deducted TDS on your salary.
If your employer doesn't issue you Form 16 within the stipulated time then he is liable for a penalty under The Income Tax Act.
In such a case, a grievance may be raised to the I-T department.
Job Change: What if you change your job amid a financial year?
In case, you change your job amid a financial year, then every employer with whom you worked during that financial year is required to issue a separate Part A of Form 16 for your period of employment.
For Part B, it's up to you if you want to collect it from all employers or just the last employer you worked with during that year.
ITR: Is Form 16 required for filing of income tax return?
No, you do not require Form 16 to file your income tax return. However, its usage is a recommended practice for the filing.
You may refer to your salary receipts for your annual income and TDS while filing your return in the absence of Form 16.