For salaried employees, Form 16 is not only a regular form—it's the basis of your income tax return. Your employer issues it with a comprehensive breakdown of your salary earnings and the tax deducted at source (TDS) on it for the financial year. With pre-filled ITR forms now largely dependent on Form 16 data, timely and correct filing has become all the easier. Any discrepancy between your ITR and Form 16 can lead to a tax notice.
Understanding the two parts of Form 16
Form 16 is divided into two parts—Part A and Part B. Part A consists of details of TDS deducted and deposited, PAN, employer's TAN, and quarterly breakup. Part B gives a detailed salary breakup and contains deductions under sections like 80C, 80D, and exemption on HRA. During submission of ITR, both the parts need to be referred together in order to report salary income and verify the already deducted notional amounts by your employer.
It helps you to match Form 26AS and AIS
Form 16 needs to be filed in conjunction with Form 26AS and the Annual Information Statement (AIS) to eliminate any mismatches. While Form 26AS provides your gross TDS, the AIS contains information on interest income, investments, and high-value transactions. Checking all three papers ensures your return is complete and accurate—and prevents future interrogation. Reconcile any discrepancy with your employer or deductor before filing if there is any mismatch.
Form 16 makes claims of deductions easy
Very few employees know that certain tax-saving deductions are already declared in Form 16. For instance, PF deductions, LIC premium payments, school fees, and interest on home loans—if claimed—are declared here. This reduces the chances of mistakes or oversights when filing your ITR. But in case you have invested elsewhere after submitting proof to your employer, you can claim them directly in your return.
It also enables you to check whether you're owed a refund
One of the easiest ways to determine whether you are due a refund is to subtract your TDS in your Form 16 from your previous year's tax liability after taking deductions and allowances. If there has been a deduction in excess, you can expect a refund when you file your return. Form 16 gives you the amount that you can easily determine the refund using, especially if you do not have any other substantial sources of income.
Don't file ITR without it
It is technically possible to file income tax return without Form 16—by doing calculations for income and TDS manually—but that adds to the possibility of mistakes. Form 16 simplifies the entire process, gives you an authentic record of your income, and keeps you protected against unintentionally under-reporting. For salaried taxpayers, it is a device to file accurately, receive refunds sooner, and be tax-compliant with confidence.
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