Form-16 Issuance to Employees
A person who pays salary to its employees is required to deduct tax at source on
the amount of salary payable and to issue form – 16 to the employees at the end
each financial year.
We can help you to manage your TDS Compliance easily by filing all the TDS returns,
pay any of the overdue TDS Deposits and issuing Form – 16 to your employees.
TDS on salary
TAX deducted at source is calculated at the prescribed rates of income tax for the
financial year in which the salary has been paid to the employees. The person, who is
paying salary, can increase or decrease the amount of TDS to be deducted on the basis of
any adjustments in the previous deficiency or extra deduction.
Total amount of TDS for each month is determined through the following elements:-
|House rent allowance.
||Donation by employees U/S 80G.
||Bonus or incentives.
If a person had been employed by more than one employer during a financial year then his/her
tax will be deducted on the aggregate salary by one of the employers as per the choice of
employee in the information filled and submitted in the Form – 12B.
So, if an employee has more than one employer in a financial year then he/she needs
to mention information in Form – 12B to one of the Employers. Once the Form-12B is
submitted to the employer, then it becomes the obligation of the employer to deduct TDS.
The TAX which is deducted from the salary of the employees must be deposited to the Govt.
by the employer along with an income TAX challan ITNS 281 on or before 7th of
every month – for the previous month.
Since 2008, all the corporate assesses and assesses who are subject to tax audit are
required to make TDS payment online through net banking facility and the payment
of taxes can also be done through the account of any other person. But the PAN
details of the person who is liable to deposit TDS to the Govt. should be clearly
mentioned in the challan for making payment.
TDS Return Filing
TDS return is filed by the employer through which they provide information and
details to the government regarding the TAX they have deducted from salary.
Under section 192 the information about TAX deduction from salary is filed in FORM – 24Q.
While filing TDS return the Employer would provide the below mentioned information to the government:-
- TAN of the employer.
- PAN of the employer.
- PAY of the employee.
- Details of TAX deposited to the Govt. along with challan Identification Number.
- Any amount paid to the employees without deducting TDS.
Due dates for filing TDS Return by Employers:
|APRIL – MAY - JUNE.
||31st - July
| July – August – September
||31st – October
| October – November - December
|| 31st – January
|January – February - March
||31st - May
After the employer files all the necessary returns, the Govt. issues TDS certificate to the
employer – which is further given to the employees. Form- 16 contains the details about TDS deducted from salary.
There are different forms which provide TDS information under different sections. Form – 16 provide details about
TDS under section 194-1A, Form 16C for TDS under section 194-1B, Form 16A for TDS other than salary and Form 27D for TCS.
Due date of Form -16 is till 15th – June of the financial year in which the TAX is deducted. The same procedure is to
be followed in the case of Form 16A but Quarterly.
Salary TDS Certificate
The salary TDS certificate in Form-16 is divided into two parts which are named as Part A & Part B.
Part A is consist of the information about the Employer like - Name, address, PAN/TAN of employer,
assessment year, period of Employment, address of communication, summary of TDS return filed,
salary paid, amount of TDS and details of TDS deposit.
Part B contains the details like salary paid, other incomes, amount deductible under chapter VI – A,
tax payable and relief under section 89. It also consists of a separate verification in which the
employer will certify that the details of salary/ TAX are complete and accurate on the basis of
account books and other available records. The person who has more than one employer in a financial
year then both the employers needs to issue Part A of Form-16 and Part B can be issued by both or
either by the last employer.
Annexure II of TDS Return in 31st May
TDS return which is filed by the employers on 31st May, consist of various details about the employees along
with the details of TDS deducted and deposited. Annexure II contains various data-points and
should always be prepared carefully by the HR and Accounts department of the company.