The Means of Form Number 16 – Form 16 is a document issued by an employer to an employee that serves as a certificate of income tax deduction at source. It is a statement of the tax deducted from an employee’s salary by the employer and paid to the government. It is also known as a TDS (Tax Deducted at Source) certificate.
It is an important document for employees as it is used to calculate the amount of tax liability and to file income tax returns. It contains details such as the employer’s PAN (Permanent Account Number), the employee’s PAN, details of the salary paid, the amount of tax deducted, and the amount of tax deposited with the government.
What Does It Means?
Form 16 is issued by the employer at the end of the financial year, usually in the month of June. It is important to note that the employer is required to issue Form 16 to the employee only if the tax deducted is more than Rs. 2,500 in a financial year.
It is divided into two parts – Part A and Part B. Part A contains details such as the employer’s PAN, the employee’s PAN, the name and address of the employer, and the amount of tax deducted. Part B contains details such as the salary paid, the amount of tax deposited with the government, and the tax liability of the employee.
Form 16 is an important document for employees as it helps them to calculate their tax liability and to file their income tax returns.