Form 16 and 16A are important documents for taxpayers because they are required to calculate their tax liability and file accurate income tax returns. People often get confused between the two forms because they are almost for similar purposes. In this article, we will explore form 16 and 16A, and difference between them.
Table of Contents
What is 16 and 16A?
Form 16
Form 16 is salary TDS certificate and it is essential for employees. Here is the important points:
- Employers are required to deduct the required tax from your salary of employee if the employee earn more than Rs 250,000 annually and pay it to the government.
- If you have declared the Income from other sources, your employer will consider that income when calculating your TDS deduction.
- If your salary is below the basic exemption limit (Rs. 250,000), your employer will not deduct any tax and you may not receive Form 16.
- If you have worked for multiple employers within a year, you will have multiple form 16 certificates.
- Form 26AS only shows the TDS details and monthly taxable salary that are included in Form 16.
Form 16 consists of two sections:
- Part A contains details about the employer (name, address), the employee (name, address, PAN, TAN), employment period and TDS information.
- Part B includes details about salary, other income, deductions, and the amount of tax payable.
In short, form 16 is a document provided by the employer to show the tax deducted from the employee’s salary.
Form 16A
Form 16A serves a similar purpose to Form 16 but focuses on different types of income. Here is the important points:
- It is used for reporting TDS on income other than salaries. For instance, if a bank dedcut TDS on your fixed deposit interest or if your insurance commission or rental income is taxed, you will receive Form 16A.
- It provides the information about the entity responsible for deducting the tax, including their name, address, and PAN/TAN details.
- It includes the information about your income, TDS deducted, and the tax deposited.
- All these details can be found in Form 26AS as well, which is useful for filing taxes.
Form 16A includes:
- Name, PAN, and TAN of deductor
- Name, PAN of employee
- The amount and date of payment
- TDS amount and date of TDS payment
In short, form 16A is a proof of TDS deducted from your non salary income.
Difference Between Form 16 and 16A
| Particulars | Form 16 | Form 16A |
|---|---|---|
|
Meaning |
It is a certificate from your employer which shows how much tax was taken out of your salary. |
It is a certificate from the deductor which shows how much tax was deducted on your income other than salary. |
|
Eligibility |
If you work as employee for someone and they pay you a salary for your work. |
If you are self-employed person or you have income other than salary. |
|
Time limit for issue |
It is issued annually, by June 15 after the financial year ends. |
It is issued quarterly, by 15th of the month following the due date for TDS return. |
|
Issued by |
It is issued by your employer. |
It is issued by banks or other financial person. |
|
Issued to |
It is issued to employees.
|
It is issued to anyone with income other than salary.
|
|
Components |
Includes details about your and your employer's PAN, tax paid, and salary information.
|
Includes details like the TAN of the person paying you, PAN details, tax paid, and payment information |
|
Relevant provisions
|
It is covered u/s 203 of the Income Tax Act 1961, dealing with salary Income. |
It is covered u/s 203 of the Income Tax Act, dealing with non-salary Income. |
Conclusion
It is important to know the difference between Form 16 and 16A for tax filing. Form 16 shows your salary income, while Form 16A shows TDS on other types of income. Both forms are essential for accurately filing your taxes as they provide information on income and tax deductions. Whether you are dealing with salary or other income, being update about form 16 and 16A helps ensure proper tax management.
Frequently Asked Questions (FAQ)
To get form 16 and 16A from TRACES, you need to follow the below steps:
- Go to the TRACES website.
- Sign in with your login details like user ID, password, and TAN
- Click on “Downloads”
- Choose “Form 16/16A”
- Enter the assessment year, quarter, and form type.
- Click on “Request Download.”
- The form will be created and appear in “Requested Downloads”
- Download the form 16 and 16A as a PDF.
Form 16 and Form 16A are not same documents. Form 16 is issued by employers for salary income and contains details of TDS. Whereas form 16A is provided by banks or tenants for non-salary income such as interest or rent and also includes TDS information.