What Is Form 16?
Form 16 is a document that depicts the Tax Deducted at Source (TDS) by the employer from the employee salary for submitting to the Income Tax department. This form needs to be maintained by the employer for every employee of their company whose salary is above a certain limit.
It should be handed over to the employee for the latter's tax filing and other legal purposes. This form includes all the information about the salary, deduction percentage, amount deducted, submission date, and so on about the TDS the employer has processed. Eventually, Form 16 is considered one of the proof for the income of an employee.
What Is Included in Form 16?
Form 16 includes various information that tells in detail about the tax deducted at source for the employee. The details available in form 16 are:
- Employer information - Name, address, PAN, and TAN details of the employer.
- Employee information - Name, designation, and PAN details of the employee.
- TDS summary - The receipt numbers of the original TDS statement, tax amount deducted, tax amount remitted in respect of the employee are recorded for all four quarters of a financial year.
- Salary and tax calculations - Particulars of the salary of the employee including the basic pay, allowances, other incomes, and tax deductions are filled here.
- Verification - A declaration is made by an authorizing officer on behalf of the employer saying that a certain tax amount is deducted from the employee and deposited to the central government and the details mentioned in the form are true.
- Annexure A & B - The payment-wise details of the tax amount deducted from the employee and deposited to the government is recorded along with the book or challan details in Annexure A or B respectively.
How to Fill Form 16?
Form 16 should be filled very carefully and correctly by the employer and maintained for all the employees without any mistakes. However, filling form 16 is very straightforward and the below step-by-step instructions can help you fill it easily.
Step 1 - Download form 16 from CocoDoc available on this page by clicking on the 'Get Form' button.
Step 2 - Use the text boxes available to enter all the necessary details required by clicking on the highlighted spaces and typing it.
Step 3 - Amount details can be entered in the allotted text boxes and the tax calculations can be made as needed.
Step 4 - CocoDoc's free digital signature feature can be used to sign the form online in the PDF editor itself.
What Is the Use of Form 16?
The purpose of form 16 or the TDS certificate maintained and issued by the employer is to certify that the employer has deducted a certain amount as tax from the employee's salary. This form 16 certificate will aid the employee to file the income tax easily as it has various income-related details and other allowances that will have an impact on the tax amount.
Form 16 can also be used as an 'Income from Salary' statement which is needed for other purposes including Visa applications, loan estimation and approval, job switching, reclaiming overpaid funds, and so on.
