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What is Form 16 and what to do with it?

Puzzled? What is Form 16?


What is Form 16 and what to do with it?

We all know the need to file an Income tax return and the process involved in it. The most important point to look upon in the procedure is the FORM 16 since we all know that it is the most important document for everyone, primarily the salaried employees.

For any salaried individual, FORM 16 holds major significance as it contains all the information, which is necessarily required to file the return for an employee. Having it makes it smooth and swift to e-file an individual’s income tax return. So now the question arises when one should ask for FORM 16?

Form-16 encloses Part-A and Part-B. Part-A envelopes the details which are related to TDS, whereas Part-B is an annexure that enfolds details of chargeable income under the head of the salary, allowances, perquisites, bonus, income tax deductions, taxable income taxes, and TDS.

Every employee is paid salary and deduction of the TDS take place, which makes it compulsory for the employer to provide the employee with FORM 16 Part-A. Though it is not obligatory for an employer to provide you with FORM 16 Part-B, you should always ask for the form as it helps accelerate your tax return filing proceed quick and easy.

The TDS entries are revised in department’s database once the employer files the TDS return. The furthest date to deposit the TDS return is before every month, for e.g., for the month of March, it is April 30th. Once the TDS return is filed, it approximately takes 10-15 days to reverberate the entries in department’s database. After completing the entries, the employer can download Form 16 for employees. So even if the employer files the return in the middle of the month, he/she should be able to provide you with the same by the end of that particular month.

The act further guarantees that the employer should issue Form-16 Part A by the end of the month after the completion of a relevant financial year in which income was paid, and deduction of tax took place. Let’s take an example of the current financial 2015-2016; your employer should issue Form-16 latest by 31st May 2016.

However, you can expect to get his/her form before 31st May and if you don’t get it by then, surely call your company’s HR department and ask for one. Technically one can file the ITR without Form-16, but it’s better to review your salary income details in ITR against Form 16.

If the employer does not issue FORM-16, then under Section 272 A (2)(g) of the Income Tax Act, the employer is liable to pay a penalty of Rs. 100 per day of the default till it issues the form. There is a provision in which the employees can access the Assessing Officer (AO), under whose jurisdiction they have to file ITR, and launch a written complaint against the employer. On the basis of this complaint the Assessing Officer (AO), may take the appropriate action.

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of the publication

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