This year, Form 16 format has been modified by the Central Board of Direct Taxes (CBDT) which you have to give to your employer. The structure of Form 16 is largely the same (containing Part-A and Part-B), however, the information given in this year is much more detailed and comprehensive than the previous years.
In addition, Form 16, i.e. both parts of Part A and Part B, have to be downloaded by the employer only from the Income Tax Department’s TRACES website. This means that both parts of the form will be standardized for all employees.
‘TRACES’ means the TDS recompilation analysis and correction enabling system. This is a website where a PAN holder can see the taxes that were deducted and deposited against his PAN during a financial year.
This year, the last date for issuing Form 16 by your employer has been increased from 15th July to 15th June. If you are confused about what statistics you should check in the revised form 16, then here is everything that you should know.
What you should see in Form 16:
The first thing you should do in your Form 16 should be that the pan you mentioned with the form matches with you. If the PAN is incorrect, then the tax deducted from your salary will not be reflected in your Form 26AS and you will not be able to claim credit for it while filing an ITR.
Form 26AS is your tax passbook. This includes all taxes that are bitten and deposited against your PAN by your employer, bank, or any other organization. Any advance tax and self-assessment you submit against your PAN will also be shown in your Form 26AS.
Part A of Part 16
The next thing to check is the Part A of Form 16. This includes a summary of the tax deducted by your employer. Part A includes your name, address, PAN and TAN and PAN of your employer and quarterly summaries of tax deducted and deposited by the government against your PAN in each quarter.
Part A also enables you to see the tax deducted from your monthly salary. You can cross these details with your payslip.
Chartered accountants advise that it is important to match the tax deduction details shown in Part A of Form 16 with Form 26AS. TDS is deducted and deposited which appears in Form 16 and should be valid against TDS appearing in Form 26AS. Any discrepancy between your form 16 and your form 26 AAS should be told to the employer. After the correction, your employer must issue a revised TDS salary certificate.
Part B of Part 16
Part B of Form 16 has the income details given to you by your employer. The income details given in Form 16 are detailed and comprehensive. The format in which the details are to be mentioned in ITR this year is given in Form 16. Therefore, taxpayers only need to copy the details from Form 16 and paste it on the required areas of ITR 1.
If you enter your ITR 1 online on the Income Tax e-filing website, these details will be filled in advance. However, individuals need to cross such pre-loaded information with Form 16.
If you have closed the jobs during the financial year 2018-19, then form 16 may also detail the income given to you by your previous employer. If you have two Form 16, check that the income from the previous employer is included in form 16 given by a new employer. If not, you will have to include income details from both form 16 while filing an ITR may have to pay additional tax.
This year, Form 16 will show you a detailed break-up of tax-saving deductions made by you in your investment announcement. “You should ensure that the tax deduction and discount claims presented by your employer and related proofs (to allow you at the time of deducting tax at source from your salary) should be properly reflected in Form 16. However In the case of additional tax-saving, investment is done at the last minute and therefore, not deducted by your employer at the time of deduction of TDS, Then it is likely that they may not be reflected in your form -16.
From this year, both parts of Form 16 have to be downloaded from the TRACES portal, therefore, Part-A and Part-B will have the TRACES logo and a unique ID. Earlier, only one part of Form 16 was downloaded from the TRACES portal and was generated by Part B employers using third-party software.
Now Part B of Form 16 will be downloaded from TRACES, it will ensure that there is uniformity in the format of the TDS certificate issued by employers. Now the employee can verify the authenticity of the TDS certificate issued by the employer. Part B will have a unique TDS certificate number and TDS-CPC logo. Employees will also be able to check Will be whether the time employers calculate the TDS has been considered the report went discounts or reductions or not.
The revised format also shows the detailed break-up of tax-free allowances you received. In the case of any discrepancy in the tax-free portion of the income statement or allowance, you should bring it to the notice of your employer and ask him to correct and modify Form 16.
What should you do?
It is important to cross-check and verifies the information available in Form 16 with your form slip and form 26AS before you begin filling your ITR. If there is any discrepancy in the available information, then you should immediately bring it to your employer’s notice and you should ask him to provide the correct information along with the corrected form 16.