What is Form-16?

What is Form-16?

India is a densely populated country consisting of 125 cr population and dominant part of the population are salaried people.Govt. gets huge extent of taxes from salaried people. The explanation is liability imposed on employer to deduct tax at source. It implies tax is to be deducted at the time of payment of salary. TDS on salary is collected on the grounds that it would be hard for Govt. to follow a person who earns salary and may not file ITR. Form 16 is certificate under section 203 of Income-tax Act, 1961 for tax deducted at source on Salary. This declaration is given by employer to employee.

Due Date of issuing Form-16

As per income tax laws last date for filing TDS returns for an employer is May 31 and Form- 16 has to be issued latest by June 15, unless the date is extended by Government. Due to Covid-19, last date for issuing Form-16 has been extended to 15th August 2020. After getting Form-16, employees should contact tax expert for filing income-tax return.

Contents in Form-16

Form 16 contains details of tax deducted at source from salary of individual income and paid to the credit of account of Central Govt. It contains two segments Part A and Part B. Section A contains details of tax deposited by employer for example challan details. Govt. deductors are permitted to make payment through book adjustment. In the event that payment is through book adjustment than Book Identification Number (BIN) is to be referenced in Form-16. Part-B contains details of salary income and deduction claim to show up at taxable income according to income tax act and taxes paid subsequently.

Is it mandatory to file return of income even after deduction of TDS?

There are numerous customers who inquire that Form-16 is received after deduction of taxes. It implies tax from salary has been deducted and we are not needed to file return of Income? I have observed that this is the biggest mistake which salaried people do. It is required to file ITR in the wake of getting Form-16. Employer calculates available income based on data it currently possesses. There might be ventures made, housing loan repaid, donations given, tuition fees paid, property sold etc. on which tax implications is still required to be calculated. You ought to consistently file ITR. In addition, it is your obligation if business defaults to deduct TDS. You ought to consistently declare right salary and pay taxes.

FAQ

Q. Even if no taxes have been deducted from salary, is there any need for employer to issue Form-16 to me?

A. Form -16 is a certificate of TDS. In this case it will not apply. However, employer can issue a salary statement.

Q. What if you change your job?

A. You will get Form-16 from each employer

Q. From where will I get to know that TDS deducted has been deposited to Central Govt. account?

A. TDS deducted and paid by employer is reflected in Form-26AS which can be seen by logging to your income tax account.

Q. Can I download Form-16 from somewhere?

A. No, You cannot download Form-16 from anywhere. You can only get it from your employer.

Q. What things should be kept in mind while giving details for Form-16?

A. You should give following details to your employer so that he deducts correct TDS- LIC Premium paid, Housing loan taken, Tax savings investments made, mediclaim paid, medical expenditure incurred for serious diseases, donations given, tuition fees paid, etc.

Due date of filing ITR for an individual salaried person

31st July is the due date unless it is extended. The due date of filing return for A.Y.2020-21 has been extended to November 2020 due to Covid-19.

Conclusion

Every deductor is required to provide Form-16 to deductee within the required time frame. TDS deducted is reflected in Form-26AS and using these details individual can file ITR. Form 16 is most important document. Many person claim incorrect refund by quoting wrong figures in ITR when compared to Form-16 and invites income tax notice to their life. It is therefore necessary that return should be filed after analyzing all the aspects on the basis of documents.