When filing ITR, two of the most important documents needed are Form 16 and Form 26AS. Form 16 primarily includes salary break-up, taxable income, TDS and other details. This year the Central Board of Direct Taxes or CBDT has revised the format of Form 16 which is to be furnished to you by your employer, Notably, the structure of the form remains the same i.e. comprises Part A and Part B but the information included in the form from this year is far more extensive in comparison to what was given in the previous years' form.
Also, both the parts of form 16 i.e. Part and Part B are to be downloaded from the department's TRACES website by employers. This means that now on all the employees will have a standard Form 16.
TRACES stands for TDS Reconciliation Analysis and Correction Enabling System and the department's portal allows a person with PAN card to trace for tax deducted and deposited against his or her PAN in a given financial year.
So, if you are a first-time income tax return filer or do not know what details to check in the revised Form 16, here is given all the information you should know:
Importantly, the last date for issuance of Form 16 by your employer had been extended to July 10 from the earlier June 15.
You should cross-check that the PAN specified in your Form 16 is actually yours. And if it's not the case then the tax deducted on your salary will not be showing in Form 26AS and while filing your income tax return you will not be able to claim a refund for it. Form 26AS is a tax statement detailing tax deducted at different sources and deposited in respect of your Permanent Account Number (PAN). So, form 26AS also reflects any self-assessment or advance tax paid by you during an FY.
Now going ahead you need to check Part A that summarizes taxes deducted by your employer. Further it includes your name, address, PAN and TAN and PAN of your employer. This part provides detail of taxes deducted and deposited with the centre in respect of your PAN on a quarterly basis. Also, you can check for the tax deducted from your monthly salary and the same can be cross-verified with your salary slips.
Herein you need to ensure that the tax deducted details provided in Part A of form 16 matches with those in form 26AS. If any discrepancy is found, the same has to be reported to the employer who upon rectification of the error will issue you a revised form 16 or TDS salary certificate.
This part features information on the salary paid to you by your employer and the income details specified in form 16 are elaborate. Further, form 16 enlists the details as is required in the ITR form, so a tax filer can simply copy-paste the details from Form 16 to the relevant field on the ITR form. And when filing ITR 1 online on the department's e-filing portal, the details come pre-filled but you need to cross-check the information in it with Form 16 for any mismatches and avoiding error.
Also, this year form 16 will include complete break-up of tax saving deductions you have claimed in the investment declaration made by you. Herein you need to note that the deductions and the exemptions claimed by you and relevant proofs submitted by you to your employer get reflected in your form 16 correctly. But if you have made some tax-saving investment at the last-minute and in a case when the same has not been taken into account by your employer while deducting TDS, then it may not show in your TDS salary certificate.
In another case when you have changed job during the FY 2018-19, then form 16 may also include income paid by your earlier employer to you.
Until last year, only Part A of the form was required to be downloaded from the TRACES portal and employers generated the other part i.e. Part B with the help of third-party software. But from this year both the parts are to be downloaded from the portal and each will bear the logo of TRACES portal plus a unique ID.
What you should be doing?
As you begin to file your ITR, you need to cross-check and validate the information given in form 16 with the details in your salary slip and form 26AS and any discrepancy if found should be brought to the notice of your employer who will then after taking corrective measures will provide you with a revised form 16.