Form 16 is the Tax Deducted At Source (TDS) Certificate issued by the employer validating the fact that TDS has been deducted and deposited with the authorities on behalf of the employee. It contains the information you need to prepare and file your income tax return.
It is issued annually, on or before 15th June of the next year, it immediately follows the Financial Year in which tax is deducted.
Form 16 has 2 components to it- Part A & Part B.
This part of Form 16 is generated and downloaded through the TDS Reconcilation, Analysis and Correction Enabling System ( TRACES) Portal by the employer. Prior to issuing the certificate, it will be authenticated for the correctness of its contents by the employer. It is important to note that if you change your job in one financial year, every employer will issue a separate Part A of Form 16, for the period of employment.Some of the components of Part A are:
a. Name and address of the employer
b. TAN & PAN of employer
c. PAN of the employee
d. Summary of tax deducted & deposited quarterly, which is certified by the employer.
Part B of Form 16 is an annexure to Part A. If you change your job in one financial year, then it is for you to decide if you would want Part B of the Form from both the employers or from the last employer. Some of the components of Part B are:
a. Detailed breakup of salary
b. Deductions allowed under the income tax act (under chapter VIA)
c. Relief under section 89
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