Features of Form 16
The following features make Form 16 an important part of the entire process of filing Income Tax Returns in India. The Form is especially important to Employees working in a company or firm.
- 1. It is applicable to Salaried personnel
- 2. It is a Tax Deduction at Source (TDS) Certificate issued by the Employer
- 3. It acts as proof that the Employer has deducted TDS while paying the Employee
- 4. It is proof of the Salary that the Employee receives
- 5. It reflects the amount of Income Tax paid by the Employer on behalf of the Employee
- 6. It can be used by the Employee as proof of his Income if the Income Tax Department wishes to scrutinize the Income Tax Returns in detail
- 7. Only an Employer with a TAN (Tax Deduction Account Number) is eligible to deduct TDS, and therefore issue a Form 16
- 8. If TDS is not deducted the Employer is not under obligation to issue a Form 16 to the Employee
- 9. If TDS is deducted, the responsibility to issue the Form 16 to the Employee lies with the Employer
- 10 Information given on a Form 16 can be corrected.
Important Components of Form 16
Following are few key components that are found in a Form 16
- 1. Personal details of the Employee including Name, Permanent Account Number (PAN) etc.
- 2. Employer details including Name, permanent account number PAN, TAN etc.
- 3. Acknowledgement Number of the Income Tax Payment made by the Employer
- 4. Details of Salary including Gross Salary, Net Salary, Perquisites, Deductions etc.
- 5. Total Income and Total Tax deducted
- 6. Details of Education Cess or Surcharge etc.
- 7. Tax deducted as per Section 192 (1A)
- 8. Receipt Number of the TDS Payment
- 9. Balance Tax Payable by the Employee or Refundable to the Employee
- 10. Details of Tax Payment including Cheque Number, DD Number, Voucher Number, Challan Number etc.
- 11. Declaration of Tax Payment by the Employer
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