Form 16 for Income Tax Filing

Form 16 is provided by employers to salaried individuals in the country. It contains all the information required by the employee at the time of filing his/her income tax returns with the Income Tax Department of India.

What is Form 16?

Form 16 is a document which needs to be filled and submitted as proof that the Tax Deducted at Source (TDS) has been deducted by the organisation or employer is deposited with the Income Tax Department.

What are the types of Form 16?

The two types of Form-16 are:

• Form 16-A: This form gives a summary of the tax collected by the employer or organisation from the salary of the employee and deposited with the IT Department. This form is on behalf of the employee.
• Form 16-B: Part-B serves as a consolidated statement which includes details such as salary paid, tax dues (if any), and any other income disclosed by the employee or employer.

How to Download Form 16? 

The procedure to download Form 16 from the official Income Tax Department website is mentioned below: 

• Visit the official website of the Income Tax Department. 
• Under the ‘Forms/Download’ section, you will find the ‘Income Tax Forms’ option, click on it. 
• Next, you will find the ‘PDF’ and ‘Fillable Form’ options available under ‘Form 16’. 
• Click on the relevant option. 
• You will be able to download the form on the next page. 

Different Sections of Form 16 

The two different sections of Form 16 are mentioned below: 

• Part A 
• Part B 

Part A 

Before the certificate can be provided, authentication must be provided by the employer. In case you move to a new job, the new employer must provide a Form 16 as well. Each new employer must provide the Form 16. The main components of Part A are mentioned below: 

• Employer’s name and address 
• Employer’s PAN and TAN 
• Employee’s PAN 
• Details of the tax deducted and deposited on a quarterly basis 

Part B 

An annexure to the first part of Form 16, Part B has the below-mentioned components: 

• Salary breakup (detailed) 
• Breakup of the allowances under Section 10 of the Income Tax Act in detail 
• Deductions allowed under Chapter VI A of the Income Tax Act 
• Any relief under Section 89 of the Income Tax Act 

How to File ITR with Form 16?

There are certain bits of information that are required when filing your ITR. These details can be found in Form 16. They include the following:

• Allowances that are exempt under Section 10 of the Income Tax Act
• Taxable salary
• A breakup of the deductions under Section 16 of the Income Tax Act
• Income from house property provided for TDS
• Income from other sources provided for TDS
• A breakup of the deductions under Chapter VI-A of the Income Tax Act covering the deductions under Section 80C, Section 80CCC, Section 80CCD(1), Section 80CCD(1B), Section 80CCD(2), Section 80D and Section 80E of the Income Tax Act
• Aggregate of deductible amount under Chapter VI-A of the Income Tax Act covering the deductions under Section 10(a), Section 10(b), Section 10(c), Section 10(d), Section 10(e), Section 10(f), Section 10(g), Section 10(h), Section 10(i), Section 10(j), and Section 10(l) of the Income Tax Act
• Refund due or net tax payable

Additional details from Form 16 required for filing your income tax returns

• Tax deducted at source by the employer
• Employer’s TAN
• Employer’s PAN
• Employer’s name as well as address
• Present assessment year
• Name and address of the taxpayer
• PAN of the taxpayer

*There are certain fields in the form that are notified for deductions. They are as follows::

Why you Require Form 16?

Form 16 can be a crucial document for the following reasons:

• It works as a proof that your employer has deducted tax from your salary and deposited it with the government
• It helps in the income tax returns efiling process
• It is usually requested by banks and financial institutions when you approach them for loans

Demystifying Form 16 for the Common Man

Form 16 Eligibility

Any individual who is earning a salary and must file tax returns are eligible for Form 16. In case individuals need not file tax returns, it is not mandatory for them to submit Form 16. However, employers issue the certificate so that a track of their earnings can be maintained.

Lost your Form 16? Here’s what you can do

Form 16 is a highly important document that must be preserved carefully. However, in case you have lost your Form 16, you can go through your mail and find it (if you received it via mail). In case you received a hard copy from your employer and lost it, you can request your employer to issue another form.

How to calculate your salary income if you have not received Form 16 from your employer?

Sometimes, employers do not provide Form 16 to employees whose annual salary is lower than the minimum taxable limit (Rs.2.5 lakh). In case you wish to file your income tax returns without Form 16, you will have to refer to your bank statements, payslips, home loan or education loan certificates, tax-saving investment proofs, Form 26AS, etc. Your payslips will contain information regarding your basic salary as well as allowances, while Form 26AS will have the information regarding all the taxes you have paid and the taxes that have been deducted.

For instance, Mr. Prabhu who works with ABC Ltd. didn’t receive Form 16 from his employer. He computed his income for the year using his monthly payslips according to which his basic pay was Rs.25,000. His payslips also showed that he had a transport allowance of Rs.1,500 per month. Moreover, he had a home loan certificate through which he was eligible for a deduction of Rs.40,000 from his income. Mr. Prabhu’s income for the financial year would be as follows:

Rs.25,000 x 12 months (Basic salary per month x no. of months per year) = Rs.3 lakh

Rs.1,500 x 12 months (Transport allowance per month x no. of months) = Rs.18,000 (Nil)

Since transport allowance is subject to an exemption of Rs.1,600 per month, Mr. Prabhu will not be taxed on it.

The total taxable income of Mr. Prabhu is Rs.3 lakh minus Rs.40,000 (deduction), which is basically Rs.2.6 lakh – Rs.2.5 lakh = Rs.10,000.

Benefits of Form 16

As mentioned earlier, the Form 16 is a document which acts as a proof for the TDS deducted by your employer or deductor and deposited to the government. Some of the benefits of the Form 16 are as follows:

1. It acts as the ‘income from salary’ statement of the individual.
2. It helps at the time of filing of income tax returns.
3. It is a supporting document for the issuance of visa.
4. It acts as a proof of income.
5. It helps keep a tab on all your tax-saving investments.
6. It provides a clear picture of the computation, payment, and refund of your taxes

Difference between Form 16, Form 16A, and Form 16B

The difference between Form 16, Form 16A, and Form 16B has been summarised in the following table:

FAQ's on Form 16

1. How is the Form 16 generated?

The TDS CPC is responsible for the generation of the Form 16 on the basis of the quarterly TDS and TCS statements processing. A deductor will be required to raise a request for the same on the TRACES website.

2. When are the due dates for the issuance of the Form 16 and Form 16A certificates?

The Form 16 is issued annually and is supposed to be issued by the 31st of May. On the other hand, Form 16A is issued quarterly and is issued within 15 days from the due date of furnishing the statement of tax deducted at source as per rule 31A.

3. Can I get a duplicate Form 16 certificate if I misplace the original one?

Yes, you have to get in touch with your deductor to get the duplicate certificate issued

4. If I am pensioner, who will issue my Form 16?

If you are a pensioner, the bank through which you are receiving you pension will issue the Form 16. Your previous employer will not be issuing the Form 16 in this case.

5. Can I download my Form 16 certificate without enrolling myself in the TRACES website?

No, you have to be a registered use on the TRACES website to be able to download your Form 16 and Form 16A.