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What Role Form 16 Has In Income Tax Filing

Adhil Shetty

If you are a salaried individual and if your salary is in the taxable income bracket, you need to collect your Form 16 from your employer for the purpose of filing your income tax returns (ITRs). Form 16 plays a vital role in making your job of filing I-T returns simpler and easier.

So, What Is Form 16?

In simple terms, Form 16 is an income and tax certificate. It provides details about the salary earned by you in the previous financial year and how much tax was deducted at source from your income by your employer.

It acts as a proof that tax was deducted from your salary and paid to the government. It contains all the information you need to file your income tax returns. Hence, collecting it from your employer is necessary to file your returns.

However, if no tax is deducted from your salary by your employer during the previous financial year, your employer may not issue you a Form 16. But you can still go ahead and file your returns.

 When And How Can You Collect Form 16?

Generally, your employer will issue you Form 16 on or before the mid of June in the next financial year for tax deducted at source in the previous financial year. If your employer fails to issue you Form 16, you can request for the same at the earliest.

If you have changed jobs in the previous financial year, you can collect Form 16 from all the employers and file your returns.

Form 16 Has Two Parts 

Part A Of Form 16

It has details about the TDS deducted from your salary by your employer and paid to the government. It contains the following details:

  • Permanent Account Number (PAN) of employer and employee
  • Tax Deduction & Collection Account Number (TAN) of employer
  • Summary of TDS and its deposits quarterly
  • Period served by the employee in the financial year
  • Name and address of the employer and employee
  • Bank challan details 

Part B Of Form 16

This is an annexure detailing salary paid, deductions, total taxable income, TDS, tax due or paid, or any rebate. In other words, it computes your tax liability or refund after taking all income, deductions, TDS into account.

It contains the following details:

  • Gross Salary
  • HRA or other allowances
  • Income from other sources (if any)
  • Deductions under Section 80 C to 80U
  • Taxable income
  • Tax liability
  • Tax paid or any tax due or refund applicable

Form 16 And Form 16 A: What’s The Difference?

Form 16 is issued when tax is deducted from source on income under the head ‘salaries’. On the other hand, Form 16 A is issued when tax is deducted at source from any income other than salary. This income other than salary can be rent of building, commission, interest, among others. Both the forms are necessary to file I-T returns.

Once you have received your Form 16, you can simply go online to file your return. You can take help of tax-filing websites, where you just need to upload your Form 16 and they will import all the data required and file the returns. You can also file your returns by logging in in the tax filing website and following the due process.

In case you do not have Form 16, you can still file your returns by downloading Form 26As as well as by computing your income and taxes paid with the help of your salary slip. Form 16 is essentially used to compute how much tax you have paid and the amount due.

The writer is CEO, is a leading online marketplace in India that helps consumers compare and apply for credit cardpersonal loanhome loancar loan, and insurance.