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ITR Filing: Understanding Form 16 for Smooth ITR Filing
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What is Form 16?
Form 16 is a certificate issued by employers to their employees, stating the amount of tax deducted at source (TDS) from their salary.
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Details
Generally, it includes details like PAN, TAN, full address, wage deductions, TDS deductions, and any other amount disclosed by the employer’s employees and the employee.
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Purpose
Form 16 is a proof of deduction of TDS from salary income and helps employees to file Income Tax Return (ITR).
Validity
Form 16 is submitted annually by employers for the previous financial year on or before 15th June of the next financial year.
Use in ITR filing
Employees use Form 16 to prepare their income returns, claim tax deductions and calculate their total taxable income for the ITR filed with the Tax Department.
Form 16 consists of two parts: Part A and Part B
Part A and Part B. Part A contains details of employer and employee, while Part B provides details of salaries, allowances, deductions and taxes distribution.
Keeping Form 16
Employees should keep Form 16 safely because it is an important document in the case of income tax audits, investigations, or any inquiries by the tax authorities.
Other Information
Apart from salary income, if an employee has other sources of income, he is required to declare and report separately while filing ITR, even if it is not mentioned in Letter 16 a.