If you have not yet received your Form 16 or salary certificate from your employer, it’s the time to worry! 15th June i.e., today is the last date to avail of your Form 16 for the assessment year 2017-18.
Form 16 is a certificate that is issued by every employer to all employees for each financial year which is indispensible for filing income tax return every year. Issued under section 203 of the Income-tax Act, 1961, it has two parts.
Part A of the form 16 comprises the personal details of the employee such as name & address, employer’s name and address, Permanent Account Number (PAN) of both employee as well as the employer, Tax Deduction Account Number (TAN) of the employer and assessment year (year in which your tax liability is calculated for your previous year income). It also details the employment period with the current employer.
This part also contains the summary of the periodic TDS on your income which includes details such as the amount and date of TDS deducted by your employer during the year, the income on which it was deducted and also the date on which it was deposited with the income tax department.
Part B of the Form 16 specifies your earnings such as gross salary, house rent allowance, etc. during your employment with the employer. It also delineates the deductions under sections 80C, 80CCC and 80CCD (such as Public Provident Fund, tax-saving mutual fund schemes, life insurance policies, pension, etc.).
All the deductions are accumulated under “Chapter IV-A” of the Income Tax Act and are then reduced from the gross income of an individual to arrive at the taxable income. Eventually, part B of the Form 16 gives details of tax payable by the employee or refundable to him/her.
According to section 203 of the Act, if employee has a taxable income, the employer needs to compulsorily grant Form 16. Nonetheless, if there was no TDS on the income, then the employer can decline to issue the form. The Act also mentions that if Form 16 is not issued by the specified deadline (15 June), under section 272A(2)(g) of the income tax Act, the employer is liable to pay a penalty of 100/day of default till it finally issues the form.
Written By Reshma RawatAssistant Content ManagerCredit Cards, Credit Score, Personal Loan, Home Loan, etc.
Reshma Rawat is a passionate writer with a decade of experience in writing for a variety of domains (finance, technology, lifestyle, e-commerce, real estate, etc.). Currently, she is working as Assistant Manager - Content @MyMoneyMantra and writes blogs & webpages on financial products (loans, credit cards, insurance, government financial policies, mutual funds, etc.).
