What is ITR Form 16? All You Need to Know About It

By | October 15, 2019
ITR Form 16

The ITR Form 16 is a certification that is issued under Section 203 of the Income Tax Act. It is issued by an employer to their employees to confirm the fact; their Tax Deducted at Source (TDS) has been deducted and deposited with the government.

Typically, the employers issue it either on or before the 15th of June every financial year, immediately after the tax is deducted. The information contained in the form is deemed as a requisite to file an individual’s income tax return.

Form 16 Part A

Part A of the form can be generated and downloaded by the employers via the TRACES portal.

The basic components of part A of Form 16 are listed below – 

  • The name and address of the employer.
  • The employer’s PAN and TAN card number.
  • A certified summary of the tax deducted and deposited quarterly.

Employers should be careful when it comes to the content of the certificate. They should check its authenticity before issuing the same to the employees. Also, if an individual change their job in a financial year, they will obtain two separate ITR forms 16 from each employer. 

Form 16 Part B

The Form 16 part b is a supplement of part A. If an individual who has changed their job in a financial year; they may choose to keep the part b of the form issued by either both the employers or just the last one.

It should be noted that the said form is deemed necessary by most financial institutions to avail a credit card.  It makes it crucial for individuals to ensure that the details enumerated in the form are correct and up to date.

The components of the form include –

  • A comprehensive breakup of the salary.
  • A comprehensive breakup of the exempted allowances under Section 10.
  • A detailed account of the deductions allowed under the current Income Tax Act.

If an individual plans on availing the Bajaj Finserv RBL Bank SuperCard they need to furnish the said form details to the NBFC offering the card.

By providing the essential documents, credit cardholders can avail interest-free ATM cash withdrawal for up to 90 days and enjoy the benefits of a SuperCard that other cards do not offer. 

The NBFC also provides pre-approved offers on these cards to simplify the process to avail them and minimise the time taken for it. These offers are valid on many other financial products as well including home loans, business loans, personal loans, etc. You can check out your pre-approved offer by providing necessary details like your name and contact number.

ITR Form 16 and Income Tax Filing

Details of ITR Form 16 deemed necessary for filing Income Tax Returns. Therefore, individuals must make it a point to avail the same from their employees on time or remind them about it.

 Individuals with an income that is less than Rs. 2,50,000 in a financial year are exempted from paying tax. Since they do not need to pay a tax on their income, they are not issued any form either.

Here are the details mentioned in the Form 16 that are deemed vital for filing Income Tax Returns-

  • The exemption on allowances listed under Section 10.
  • The breakup of the deductions listed under Section 16.
  • The taxable salary.
  • The breakup of the deductions available under Section 80C.
  • The gross and deductible amount aggregated under Section 80c.
  • The income generated from housing property that was reported by the employee and offered for TDS.
  • The income under ‘Other Sources’ that is offered for TDS.
  • The refund due or tax payable.

But for those individuals who must pay a tax on their income, they must make it a point that their tax file process does not get delayed or missed. Additionally, before applying for a credit card, individuals must solve all the issues with the IRTC Form 16 and its attainment that may delay the process.