What is Form 16?Form 16 is nothing but a certificate given by your company or organisation that certifies information regarding the salary you have received during the fiscal year and the amount of TDS that has been subtracted from your pay.
In case, the income from your annual salary is higher than the basic tax exemption limit; then, your employer is asked to subtract TDS from your pay and give it to the Indian government. Employer provides Form 16 to their employees as proof of filing the Income Tax Returns on their behalf. If your annual income is lower than the exemption limit, no TDS is deducted from your salary..
Form 16 comprises of two parts known as Part A, & Part B.
Part Acomprises of information of the employer and employee. It also includes PAN and TAN information, name and address, TDS deposited and deducted, along with a few other info.
Part Bconsists of information regarding other income, deductions allowed, salary paid, payable tax, etc. Form 16 is issued annually by the company, which is usually before the 15th of June of the following year. It promptly follows the fiscal year in which tax is subtracted. Plus you don't have to worry if you lose your form 16, you can get a duplicate one issued from your employer without any hassles.
Listed below are the critical components of Form 16:
- Information regarding the employer like the Collection Account Number (TAN), name, Permanent Account Number (PAN), Tax deduction, etc.
- Refunds (if any) to the employee, or payable tax balance by the employee.
- Employee's personal details, like full name, Permanent Account Number (PAN), etc.
- All information regarding Tax Payment, like amount, Challan number, Demand draft number, Cheque number, etc.
- Taxes deducted according to Section 191A.
- Acknowledgment of the total number of taxes paid by the employer.
- Other information like salary, gross salary, net salary, perks, deductions, etc.
- Declaration of tax payments from the employer.
- TDS receipt paid.
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
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