How is Form 16 different from Form 16A? How are they used while filing ITRs?
Question: What is Form 16? How is it different from Form 16A? How are the said forms useful while filing income tax returns?
Answer given by Dr. Suresh Surana, Founder, RSM India: Section 203 of the Income Tax Act, 1961 (herein after referred to as “IT Act”) mandates every person who deducts tax under relevant provisions of the IT Act to furnish to the person whose tax has been deducted, a certificate stating that tax has been deducted, and specifying the amount so deducted, the rate at which the tax has been deducted and other particulars as deemed necessary.
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Where the tax has been deducted in accordance with provisions of section 192(1A), such certificate shall be provided in Form 16 by the employers to the employees on annual basis by 15th June of the financial year immediately following the financial year in which the income was paid and tax deducted. In cases otherwise, the certificate shall be furnished to the deductee in Form 16A on quarterly basis within 15 days from the due date for furnishing the statement of TDS.
Form 16 has been further divided into two parts, namely, Part A and Part B. Part A of the form comprises details of TDS deducted and deposited quarterly, details of PAN and TAN of the employer and other related information, whereas Part B of the form being an Annexure to Part A contains details of the computation of total tax liability taking into consideration the various components of salary and relevant deductions approved under Chapter VI-A and/ or exemptions. Similarly, Form 16A includes details like deductor’s name, PAN and TAN, Deductee’s name and PAN, Payment details, TDS challan number, Date of deposit, TDS amount deposited etc.
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Considering the details as mentioned in Form 16 and Form 16A would be auto populated in the income tax return of the taxpayer, it is essential for the taxpayers to pay attention to the following aspects in Form 16/ 16A:
i. Firstly, the taxpayer shall verify his/her PAN with the one mentioned in the form as incorrect PAN shall lead to exclusion of the deducted tax from Form 26AS and accordingly the taxpayer shall not be entitled to claim credit of the same while filing ITR.
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ii. Additionally, the taxpayer should also cross-check the accuracy of other personal details like name, address, deductor’s TAN etc.
iii. Further, in case of Form 16, it is also vital to ensure that the tax saving deductions and exemptions claimed is correctly reflected and if not, the employee need to separately claim such deduction / exemption while filing their tax return.
In case of any discrepancy in the details, the taxpayer may approach the deductor to revise their TDS returns and provide them with a revised Form 16 / Form 16A after rectifying the error.
