What is Form 16? Is it Mandatory for the employer to issue you a Form 16?
Form 16 is the TDS certificate that the employer issues you when TDS is deducted by your employer. When an employer deducts TDS on salaries – the Income Tax lays down that TDS certificate must be issued by the employer, once in a year, on or before 31st May of the financial year immediately following the financial year in which tax is deducted. Think of it as a TDS certificate just like banks issue TDS certificates in respect of Tax they deduct from your Interest Income.
Form 16 now has a new format – Part A and Part B. Part A primarily has TAN & PAN details of employer & employee and details of tax deducted & deposited which is certified by the employer. Part A must be generated and downloaded through Traces Portal. Part A of the Form 16 also has a unique TDS Certificate Number. Part B has other remaining details such as- details of salary paid, amounts deductible under chapter VIA, relief under section 89. Part B is prepared by the employer manually and issued along with Part A. If the person is employed under more than one employer during the year, each of the employers shall issue Part A of Form 16 for the person such a person was employed with each of the employers.
If there is no TDS is the employer required to issue a Form 16?
TDS certificate in Form 16 is only required to be issued to the employee when TDS has been deducted. In case no TDS has been deducted by the employer he may not issue you a Form 16.
When the employer deducts TDS and does not issue a certificate?
Any person responsible for paying salaries is required to deduct tax at source on the amount payable. The Act lays down that every person who deducts TDS from a payment made, must furnish (to a person to whom such payment is made) a certificate with details. An employer in specific, is compulsorily required to furnish you a certificate, in the format of Form 16, specifying that tax has been paid to the Central Government, with the amount so paid, the rate at which the tax has been paid and other prescribed particulars.
In case an employer fails to provide you a Form 16 after having deducted TDS – the minimum penalty that the employer will pay is Rs 100 for every day the default continues. You can write about this failure of your employer to the Assessing Officer who may take appropriate action against the employer, including levying penalty as mentioned above and also carrying out further proceedings against the employer.
Your Form 26AS, will have details of TDS deducted by your employer, you can check your TDS details from there – if the details don’t show up, well it means the employer deducted TDS from you and didn’t deposit with the government! In this case, you may have to pay tax to the government on your income yourself and later on claim from your employer.
If no Form 16 has been issued to me does it mean I don’t have to pay tax or file a return?
While the onus of deducting tax on salaries and providing a certificate in respect of TDS is on the employer – the onus of paying Income Taxes and Filing of Returns is on you. If your income under all heads, including salaries, is above the minimum tax slab you are required to pay tax – whether your employer deducted any tax from you or not or even when he fails to issue you a Form 16. Also, here is a post that will guide you about filing of a income tax return https://blog.cleartax.in/are-you-required-to-file-an-it-return/.
Remember with clearTax, you can file your returns whether you have a form 16 or not. Simply upload your Form 16 or even when you don’t have a Form 16 – you can file hassle free with us.