Getting Form 16 from your employer makes life easier for a salaried individual when filing income tax return (ITR), according to an Economic Times article.
The Form 16 shows the details of salary income paid, tax regime opted by an employee, total tax deducted and deposited against salary income during the financial year, and the eligible deductions claimed by the employee.
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Income tax laws mandate that a TDS certificate must be issued within 15 days from the due date for filing the TDS return by the deductor. The due date to file TDS return is May 31 for fourth (final) quarter of a financial year.
As the TDS certificate to be issued by the employer is for the full year, it can be issued only after the TDS return for the last quarter (Q4) of the FY has been filed. Therefore, companies must issue Form 16 to their employees within 15 days of May 31 i.e. by June 15.
An employer/company may issue the Form 16 to its employees before June 15 also but would do so only after it has filed its TDS return for the fourth quarter of the previous FY.
The two parts of the form
Form 16 has two parts - Part A and Part B. Employees should ensure that they have received both parts of Form 16.
Both the parts should have the TRACES logo to ensure their authenticity because as per law the issuer has to download them from the TRACES portal after filing of TDS returns.
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Part A: This shows total tax deducted from salary income in each quarter of the financial year as well as other details such as the PAN of the employee, and PAN and TAN of the employer.
Each employee should ensure that the total tax deducted during the financial year matches with the tax deduction shown in Form 26AS. If there is any mismatch, it should be brought to the employer's notice and must be corrected.
Part B: This part of the TDS certificate shows the tax regime the employee opted for to calculate TDS (tax deducted at source) on salary. The TDS certificate would have an entry, "Whether opting for taxation u/s 115BAC". If it says "Yes", then tax on salary is deducted as per the income tax slabs under the new tax regime. If it says "No", tax is deducted as per the income tax slabs under the old tax regime.
Part B will show the gross salary paid during the year, including allowances and perquisites such as company car; deductions and exemptions that are eligible and claimed; and net tax paid on the taxable salary.
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How to match Form 16 details with Form 26AS
Form 26AS is a tax statement or tax passbook that shows information on all the TDS and TCS deducted/collected from an individual/taxpayer during the financial year.
To ensure that there is no mismatch, a taxpayer should keep both Form 16 and Form 26AS handy. The employer will give Form 16. Form 26AS can be downloaded from the income tax e-filing portal.
Login to your account on the income tax e-filing portal by entering username (PAN) and password. Go to e-file> Income tax Returns> View Form 26AS. You will be redirected to another TDS website. Here click on View/Verify Tax credit> View Form 26AS and enter the assessment year (AY 2024-25 for FY 2023-24) and view as HTML. Click on View/Download to read or download the form. It will show the total tax deducted during FY by various deductors.
Match the amount of "Total tax deducted" and "Total tax deposited" as shown in Form 26AS with Part A of the Form 16. Also match the "Total amount paid/credited" in both Form 26AS and Form 16. If it matches, the taxpayer can easily proceed to file ITR. If there is a mismatch, this should be taken up for correction with the tax deductor - which is the employer in case of a salaried individual.
News / Business / ITR due dates: When will Form 16, TDS certificate, Form 26AS be available?
