Form 16 is essentially a document issued to salaried employees by their employers, confirming that Income Tax has been deducted at source and transferred into the government’s account. Form 16 is mandated by law under the Income Tax Act, 1961, and is supposed to be issued annually by an employer.
In general, Form 16 is a one-stop guide to an employee’s detailed summary of income earned and the Tax Deducted at Source (TDS) on the same. Form 16 mitigates the process of filing your Income Tax Returns by ensuring that you avoid any rookie mistakes or provide incorrect information while disclosing your gross income.
There are three different kinds of Form 16, namely Form 16, Form 16A and Form 16B.
Form 16 is divided into two components — Part A and Part B, both of which verify the TDS on income earned by a salaried employee.
Form 16A highlights the TDS on interest earned from fixed deposits, mutual funds, and other capital gains. On the other hand, Form 16B specifies the TDS while making a property purchase. Once you understand how to fill out the different types of Form 16 online, it can help ease the process of filing your ITR.
Form 16A typically details down information about the following components:
Full name and address of the employee
Full name and address of the employer
PAN number of the employee
PAN number of the employer
TAN number of the employer
Employee reference number provided by the employer
Details about quarterly tax deduction and deposition with the government
Acknowledgement number of TDS payment
Employment duration with the employer
Components of Form 16B include:
Details about salary paid such as HRA, gratuity, pension, encashment of leave and deductions
Deductions under Income Tax act Chapter VI-A
Education tax and surcharge as applicable (if any)
Gross total income
Total taxable income
Net tax payable
It’s important to know that Form 16 can only be downloaded and issued by an employer and not by an employee. There is a common misconception that any individual can download Form 16 online with his/her PAN. Although that is not the case, all salaried employees are eligible to get their Form 16 issued by their employer.
Now that you know a bit more about Form 16, we can take a look at how an employer can download Form 16 online. Here’s the full list of steps on how to download Form 16 online:
Step 1: Visit the TRACES portal of the Income Tax Department.
Step 2: Login by entering your User ID, Password and PAN before entering the captcha code.
Step 3: After logging in, click on the ‘Downloads’ tab and select ‘Form 16’.
Step 4: Select the desired year of assessment.
Step 5: Verify name and PAN details.
Step 6: Enter the TDS receipt number.
Step 7: Select the date of TDS before adding the total tax collected and deducted.
Step 8: Submit Form 16 for download.
Step 9: Select ‘Requested Downloads’ under the ‘Downloads’ tab.
Step 10: Once the Form 16 Part A and Part B status turns ‘Available’, download the files in HTTP or PDF format.
As employees cannot download Form 16 themselves, they need to request Form 16 from their employers. Alternatively, an employee can seek help in obtaining his/her Form 16 by contacting the organisation or the company’s HR team.
To get Form 16 for the previous year, employees can request the organisation or company’s HR team to send the TDS certificate for any separate period during the previous year. Employers can issue Form 16 for the previous year by categorically choosing last year’s TDS assessment period on the TRACES portal of the Income Tax Department.
Some important details that are required to be filled in Form 16 Part A include the name, address, TAN and PAN of the employer. It also needs to include the PAN of the employee and the summary of tax deducted and deposited quarterly, which is certified by the employer.
Part B of Form 16 is to be prepared by the employer and it contains details of an employee’s income earned apart from his/her salary. This part includes contributions made towards other financial instruments such as PPFs, LIC policies, tax saving mutual funds, pension etc.
If you have misplaced a hard copy of your Form 16, or accidentally deleted the file online, you can request your employer for a duplicate of the document. Once the request is processed, your employer can issue an identical Form 16 online.
Form 16 is an important document for employees to have, and it’s not only for filing ITR. As Form 16 contains evidence that TDS has been deducted and provided to government authorities on behalf of the employee, it can serve as legitimate income proof. Based on the details of Form 16, banks can decide to increase an employee’s credit card limit or approve house/car loans.
Form 16 can be downloaded on the TRACES portal website. However, only employers can download Form 16 online and issue it to their employees.
In order to generate Form 16, an employer must log into the TRACES portal website and enter the ‘User ID, PAN and TAN of the Deductor’. Select ‘Form 16’ from the ‘Downloads’ column and then select the desired year of assessment before filling in the necessary details and submitting for download. Know more about how to fill form 16 in detail.
Salaried employees cannot download Form 16 online. A salaried employee must request their employer or company’s HR team to issue Form 16.
As Form 16 contains vital information about an employee’s salary and personal information, it is always password protected. However, an employee can figure out his/her password to log in and check for information on Form 16 by entering the first 5 characters of the PAN number in capital letters, followed by his/her Date of Birth in DDMMYYYY format.
Yes, you can get Form 16 online without enrolling yourself on the TRACES website. Form 16 Part A and Part B can be downloaded online in a PDF format from the https://www.incometaxindia.gov.in website.