Wednesday, 9 May 2012

What Is Form16 and Form16A? and Uses of Form16

Form16 :

For every salaried employee the employer will deduct the TDS at the time of salary payment. Form 16 is nothing but TDS, salary pay details of an employee i.e. how much salary is paid to him and what amount of TDS Deducted by the employer from each and every month’s salary payment. Employee can use this for filing income tax returns. Form 16 will be issued after the current financial year. If there are any issues with income tax Dept. Form 16 will useful for you. So it is safe to kept all your forms 16 along with you.

Important points to remember:

  • ·         Form16 will be issued to only salaried employee
  • ·         Only employers holding valid TAN Can deduct the TDS And provide Form 16.other wise they will not provide the Form 16
  • ·         For16 is the detailed summary of Income and Tax deductable at source
  • ·         Self Employed person will not get form 16 any way .in that case such person need to file income return and submit proof of your income to IT dept.
  • ·         This is the responsibility of the employer to issue form16 .if there are any mistake in  form 16 then it is your responsibility to correct and wait for refund if your are beneficiary .but it will take long time.
  • ·         Consultants are different from employees. The fee received by consultants is not come under salary. It is like professional fee .
Uses of Form16:

  • ·         In these days form 16 is compulsory to get housing loan from banks. Employees are required to submit form16 as supporting document to process your loan purpose.
  • ·         As said above it will be useful if there are any issues with Income tax Dept

Form 16A: The main difference between  form 16 and 16A is source of income .if the one person  income is  salary then he/she will get Form16 from his/her employeer.if the income is other than salary then he/she will get Form16A.For Example consultants will get Form 16A because fee received by consultants is not come under salary. It is like professional fee as said above

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