The
time has come for your employer to inform you about the taxes deducted in the
previous year i.e. for the financial year 2016-17. Each month, the employer
would have deducted tax at source (TDS) on your salary income and deposited the
same to the government.
The
income tax Act mandates everyone who deducts TDS to issue a certificate to the
individual. Under section 203 of the Income-tax Act, 1961, the employer is
mandated to issue Form 16 to the employees showing the total TDS on
income.
And
this should happen before the end of this month. Archit Gupta, founder &
CEO ClearTax.com informs, "The last date for the employers to share the
form 16 with the employees is 31st May of the financial year
immediately following the financial year in which income tax was paid and
tax deducted." However, in case there is no TDS deducted, the employer
need not issue the TDS certificate in Form 16.
Budget
2016 gave few extension in TDS submissions. "The due dates were extended
for submission of TDS Returns. But no extension has been announced for Form 16
yet. It must be kept in mind that an extension in the deadline for employers to
provide Form 16 will reduce the time available for filing of returns for
the salaried who rely on Form 16 to prepare their returns", says
Gupta.
Penalty
for employer
It
is compulsory for the employer to furnish Form 16 to the employee, whether it
is the present or any previous employer. "Under section 203 of the Income
Tax act, 1961 read with rule 31 of the income tax rules 1962, it is mandatory
to furnish." But, what if the employer fails to do so? "Under section
272A (2) (g) of the Income Tax act, the employer is liable to pay the
penalty," says Gupta.
In
case the employer has not provided the Form 16 to the employee by May 31 and
delays it, there are penalties in place too. Gupta says, "If the employer
fails to furnish the form 16 within the due date, he is liable to pay a penalty
of Rs.100 per day of default till he issues the form. However, the penalty will
not exceed the amount of tax deductible."
What
to do if not received
At
times employees find it difficult to collect the Form 16 from previous
employers and sometimes even from the present ones. "The only remedy in
case employer refuse to issues Form 16 is to complain to the concerned
assessing officer in writing, who will take appropriate action or initiate
penalty proceedings against the employer. The employee, however, has no other
legal remedy against his employer in case he refuses to issue the certificate
except to intimate about such default to the concerned assessing officer, who
may take appropriate action or initiate penalty proceedings against the
employer."
What
all is there in Form 16
Form
16 is a summary of the total amount paid to the employee and the TDS on
it.
There
are two parts in Form 16- Part A and Part B. While the basic information of the
employer and employee, like name, address, PAN and TAN details, period of
employment with the employer, summary details of TDS deducted and deposited
with the government are captured in Part A, while Part B includes Income
chargeable under the head 'Salaries', any other income reported by employee,
the various deductions under Chapter VI-A such as section 80C, Section 80D
etc.
Lastly,
it will carry the figures for total income (earned during the previous year)
and the tax applicable to it. "Part A must be generated and downloaded
through Traces Portal. Part A of Form 16 also has a unique TDS Certificate
Number. Part B is prepared by the employer manually and issued along with Part
A," says Gupta.
Conclusion
In
addition to the salary income, an employee may have other income too. Once you
have received the Form 16 but had not declared any other income to the
employer( and therefore no TDS was deducted on it), you may show it while
filing the income tax return, the last date for which currently stands at 31st
July.
Source:-The
Economic Times
