Form 16 is a type of income tax form which is used to file IT returns by the employees. It contains all the information of the employee which is required to file income tax return. Form 16 is provided by the employer and it is considered as a proof of filing of income tax by the employees. For every employee who falls under the income tax bracket, it is mandatory to file income tax via Form 16. The income tax department verifies the details provided by the employee in Form 16 and it is ultimately used to file income tax returns.
Benefits of Form 16:
The components of Form 16 are:
Form 16 is divided into two parts, Part A and Part B. Part A contains the PAN details of the employees and the TAN details of the employers. It is more fundamental than Part B of the form. Other details that are required to be filled by the employee in Part A of the form are TDS deducted by the employer, current financial assessment year, name and residential address of the employer and the employee.
Part B of the form contains details regarding the tax deductions made by the employee in the financial assessment year. The details provided by the employee in form B must include-taxable salary, TDS provided by the employer, breakdown of the deductions made under section 80C and any form of tax rebate applicable to the person's salary.
How to verify Form 16
Form 16 vs 16A
|Section 203 of Income Tax Acts provides this certificate for tax deducted at source from income chargeable under the head of ‘salaries’.|
It is a certificate under Section 203 Income Tax for tax deduction at source for income other than salary.
|Anyone who earns a steady and regular income in the form of salary.||Anyone who is either self-employed or a professional with document qualification degree.|
|Interest on securities, dividends, interest other than interest on securities, etc.||Issued against rent, commission, professional charges, building, plant, machine hired, commission agents, etc.|
|Proof of income, details of tax paid by employer on behalf of employee, PAN and TAN of employer, PAN of employee, acknowledgement of amount of tax paid, education cess and surcharges.||Name, TAN, PAN of employer; Name and PAN of all employees. Amount paid and nature of payment, receipt number of TDS payment.|
ONLINE VERIFICATION PROCESS
|Can be verified online||Can be verified online|
It is an official form that contains tax-related information of the taxpayer. Form 26AS also contains the details of tax deducted at source, tax collected at source, advance tax and high-end transactions. Form 26AS is linked with PAN details and the details in form 26AS are listed below
Form 26AS consists of three parts - A, B and C. Part A contains details of tax deducted at source. It contains the details of all the taxes that are deducted at the source, whether it is salary, pension income or interest income. It contains details of the deductor along with the details of the tax amount which is deducted.
Part B contains the details of the seller and tax collected at source (TCS) on the selling price of a commodity.
Part C contains the details of direct taxes paid by the taxpayer, advance tax and self-assessment tax
How to view form 26AS
One can view form 26AS by two methods:
TRACES or TDS reconciliation analysis and correction enabling system facility: The taxpayer needs to register with the TRACES in order to use the facility. An employee needs to follow these steps in order to view form 26AS:
An employee can also use the netbanking facility to view 26 AS. Any person with a PAN card and who has an account with any of the authorized banks can use this service for free of cost. Viewing the form is more convenient with netbanking
How to view form 26AS without registering
You can view form 26AS without even registering with net banking facility. You can view form 26AS from TRACES website. Registering your credentials with the TRACES website is not mandatory to view the form, you can also view the form if your account number is linked with any of the authorized banks. The list of banks who have the facility of viewing form 26 AS are:
Forms 15G and 15H
When the interest income of an individual is more than ₹10,000 annually, the banks need to deduct TDS from that particular account. When a salaried individual’s income is below the taxable limit, to avoid tax deductions from their income, they need to submit form 15G or 15H to the bank, requesting them not to deduct TDS from the amount of interest that is earned by the person.
Form 15H ensures exemption of TDS deduction from a person’s bank account. It is only applicable for an individual who is 60 years or older. It is a declaration under section 197A of Income tax act, 1971.
Eligibility criteria for submission of form 15H
While form 15H is supposed to be submitted by senior citizens (>60 years of age), 15G is applicable for all the other individuals who earn an income from sources like deposits, loans, advances, etc.
Eligibility criteria for submitting form 15G