This Article is From Dec 26, 2020

Here's All You Need To Know About Form 16

Income Tax Form 16 is a crucial document and also reflects any additional income of the employee and the deductions availed by the employee to decrease the tax liability

Here's All You Need To Know About Form 16

Form 16 is pre-filled based upon the employee's income and the tax deducted during the year

Income Tax Form 16: Form 16 is an essential document for salaried individuals, especially if the employer has deducted tax on the income. Form 16 is a certificate provided by the employer to the employee showing the amount of tax deducted from the salary income. When an employee files his/her income tax return (ITR), form 16 helps one see the amount of tax that has already been paid, and the amount due to be paid. Form 16 displays the tax deducted at source (TDS) during the financial year. The TDS deducted by the employer is deposited to the Income Tax (I-T) Department. Form 16 also reflects any additional income of the employee and the deductions availed by the employee to decrease the tax liability. Although the form is a crucial document for employees, it is not supposed to be filled up by employees themselves. (Also Read: ITR Filing: Have You Filed Your Income Tax Return Yet? Keep These Due Dates In Mind )

Form 16 is pre-filled based upon the employee's income and the tax deducted during the year. The form is generated by the employer from the TRACES portal, which is an Income Tax department tool. Employees can check form 16 entries or review their details like perquisites, allowances, or other income and deductions reported by them. All those employees or salaried individuals who have a taxable income and the tax has been deducted at source by the employers, are eligible to receive form 16.

Form 16 is supposed to be compulsorily given by employers to employees if the employer has deducted the TDSon the employee's income. The form is a tax certificate that reflects complete details of the income earned and the TDS deducted amid the financial year. It helps salaried employees to file an income tax return, especially for those who do not have income from any other sources. It can be downloaded through the TRACES software by an employer.