written by Khatabook | July 1, 2021

What is the Difference Between Form 16 and Form 16A?

What is Form 16?

Form 16 means the certificate of Tax Deducted at Source (TDS) given by the employer after the end of the fiscal year for taxes deducted from salary. The salary TDS certificate is also known as Form 16. On the other hand, Form 16A is the TDS certificate that shows the TDS details of non-salary tax deduction.

An employer deducts Tax at Source (TDS) on the salaries of employees whose total income during any financial year exceeds the basic exemption limit of Rs. 2,50,000.

What is Form 16 salary certificate? 

The employer issues the Form 16 salary certificate within 15th June of the fiscal year following the fiscal year during which the income was paid and tax deducted. For example, for FY 2020-21, the due date for the issue of Form 16 shall be 15th June 2021.

If there has not been any deduction of tax from salary, the employee is only entitled to get the salary certificate and not Form 16.

Now let us understand how to fill form 16 for salary with example:

Suppose, Amit age 45, works in ABC Co. and gets Rs. 1 lakh as salary per month during the financial year 2020-21, i.e. from April 2020 to March 2021. He has no other source of income, while he has paid Rs. 80,000 during the year as a life insurance premium and Rs. 20,000 as medical insurance premium.

The income tax slab for individuals below 60 years of age is as below:

Income Tax Slab For the Financial Year 2020-21 (Assessment Year - 2021-22)

For Individuals (Other than Senior or Super Senior Citizen)

Income

Rate

Income Up to Rs. 2,50,000

Nil

Rs. 2,50,000 to Rs. 5,00,000

5%

Rs. 5,00,000 to Rs. 10,00,000

20%

Above Rs. 10,00,000

30%

     

Now let’s find his taxable income and tax payable amount.

Income from salary

Rs. 12,00,000

Less: Standard Deduction

Rs.      50,000

Total income from salary 

Rs. 11,50,000

Less: Deduction u/s 80C (life insurance premium paid)

Rs.      80,000

Less: Deduction u/s 80D (medical insurance premium paid) 

Rs.      20,000

Net Taxable Income

Rs. 10,50,000

Also Read: How To Make TDS Payment Online?

Tax payable as per slab above 

Income

Rate

Tax Amount (Rs.)

Up to Rs. 2,50,000

Nil

0

Rs. 2,50,000 to Rs. 5,00,000

5%

12,500

Rs. 5,00,000 to Rs. 10,00,000

20%

1,00,000

Rs. 10,00,000 to Rs. 10,50,000 

30%

15,000

Income Tax

 

1,27,500

Add: Health & Education CESS

4% on Income Tax

5,100

Total Tax Liability

 

1,32,600

TDS to be deducted every month

1,32,600/12

11,050

Now, the company would deduct Rs. 11,050/- monthly from Mr Amit’s salary as TDS and pay it to the government. The company will also furnish all the details of the deductees about the tax deduction in its quarterly TDS return filing with the government.

At the end of the year, the company issues the salary certificate Form 16 to Amit. The employer certifies the salary Amit has earned during the year and the amount of TDS deducted.

Note that Form 16 is issued annually to the employee and not quarterly. 

Parts of Form 16

Form 16 has two sections, ‘Part A’ & ‘Part B’. 

Form 16 Part A has details like:

  • PAN No (Permanent Account Number) of the employer/ deductor
  • TAN No (Tax Deduction Account Number) of the employer/ deductor
  • Employer’s name and address
  • Employee’s name and address
  • PAN No of employee
  • Assessment year
  • The period of employment
  • The date and amount of tax deduction and deposit date by the employer.

Sample of Form 16 Part A

Part B is a part of Form 16 that has the consolidated detail of salary paid during the financial year. This salary form highlights the calculation of taxable income by the employer based on the employee’s salary structure. It also includes the details of other incomes and deductions provided by the employee. 

It highlights the following details:

  • Income from salary in Form 16. (It includes all the salary components like Basic, DA, HRA, LTA, Professional Tax, etc.)
  • Gross income from salary plus any other income as reported by the employee.
  • Deductions u/s 80C, 80CCC, 80CCD (Maximum limit Rs. 1.5 lakh)
  • Deduction u/s 80D (medical insurance premium), 80E (interest on education loans), 80G (donations), etc. (It is necessary to submit the investment and other payment receipts to the employer for claiming tax deduction)
  • All the qualifying deductions subtracted from the gross income to arrive at the Taxable Income. Then tax is calculated based on the income tax slab relevant for that year.
  • The TDS is deducted by the employer and subtracted from the tax liability.  The net effect can be nil tax payable or lower tax payable or refund of tax already paid.

Sample of  Form 16 Part B

What is Form 16A?

Form 16A is also a TDS certificate. While Form 16 is for tax deducted on salary, Form 16A is a TDS certificate issued by the deductor when you receive non-salary income.

For example, banks deduct TDS on the fixed deposits interest. The payer also deducts TDS on your income on commission or brokerage, or professional fees. There are different TDS rates for different types of income, and each income has a different threshold limit for TDS. 

The details of Form 16A highlights the following:

  • Name and address of the deductor
  • Name and address of the deductee
  • PAN and TAN details of the deductor
  • PAN of the deductee
  • The total amount paid and tax deducted during the financial year
  • Date of payment.

Let’s understand with a simple example. 

Mr John is an architect who has worked for YC Infrastructure Ltd., and he has charged professional fees of Rs. 10 lakhs.

Now let’s find out the tax to be deducted by YC Infrastructure Ltd. They would deduct the tax @ 10% u/s 194J on payment towards professional fees.

Professional Fees

Rs. 10,00,000

Less: Tax deducted @ 10% u/s 194J

Rs. 1,00,000

Net amount paid

Rs. 9,00,000

In this example, YC Infrastructure Ltd. would deduct Rs. 1,00,000 and deposit the same with the government and also show in its TDS return filing.

Later, Form 16A certificate would be issued to Mr John stating the details. It would include the total professional fees paid, tax deducted, date of payment and tax deduction, the tax deduction rate, the section under which tax was deducted, etc.

Sample of a Form 16A

Also Read: Salary Calculator 2020-21 - Take Home Salary Calculator India

Differences between Form 16 and Form 16A 

Form 16

Form 16A

The Form 16 salary certificate states the details of tax deducted at source on salaries.

The Form 16A TDS certificate states the details of tax deducted at source on income other than salaries.

The employer issues this certificate to the employees.

Deductors such as banks, financial institutions, tenants, etc., issue this certificate.

It is issued annually.

It is issued quarterly.

Form 16 applies to salaried employees.

Form 16A applies to rent, professional fees, commission income, brokerage, technical fees, directors fees.

FAQs

What is the password for opening the Form 16A file?

The password for opening Form 16A will be the company’s TAN in capital letters, for example, AAAA11111A.

What is the password for opening the Form 16  file?

The password for opening Form 16 will be the PAN (first 5 letters in uppercase) and DOB (“DDMMYYYY” format). For Example, AAAA101012011.

What is the password for opening the Form 16B file?

The password for opening Form 16B will be the Date of Birth of the BUYER (in DDMMYYYY format). i.e., 01012011

When to download Form 16 after filing the quarterly TDS return?

All employers must issue Form 16 to the employee within 15 days of filing the fourth-quarter TDS returns.

How can I get my Form 16A?

 You can demand your form 16A from the person/deductor who has deducted your TDS, like banks, financial institutions, contractors, agencies, etc. 

Will my employer issue my TDS form for salary when no TDS is deducted?

Form 16 is a certificate of TDS, and in your case, it will not apply. But, your employer must issue a salary statement.

Does the employer issue Form 16A to its employees?

Form 16A is not for the employees, Form 16 is. So, the employer does not issue Form 16A to employees.

If the original TDS certificate is lost, can a duplicate certificate be issued?

Yes. Deductor will have to issue the duplicate certificate.

I have not received the salary form 16 from my employer. Am I able to claim TDS deducted from my salary?

Yes. You can claim the TDS amount in your return based on the 26AS Form. But, the department will raise a demand on your employer.

What can I do if I cannot get the TDS certificate (Form 16 / 16A)?

 It is the duty of every person deducting tax to issue a TDS certificate. Despite your request, if you do not get the certificate, then there is a chance that the tax deducted is not deposited by the deductor to the government account. Please inform the department (PRO or TDS section), which will then do the needful.

From where I have to get Form 16?

Form 16 is usually provided by the employer when they deduct TDS (Tax Deducted at Source, shown in Part-A of Form 16) on salary paid. 

It is a must for an employer to issue Form 16 to the employee if there is any deduction of TDS. You should contact your employer and ask for Form 16 at the earliest if it’s not issued to you.

 Do I have to file an income tax return if I have received both Form 16 and Form 16A?

The Income Tax Administration requires that you file your income return when your total income exceeds Rs 2.5 lakh in the fiscal year. 

Therefore, although your employer may deduct TDS from your income, and Form 16 and Form 16A are issued, you should file the income tax return if your income exceeds the basic exemption limit.

What if I cannot get a Form 16 salary certificate from my previous employer at the time of joining?

Your best option then is to fill Form 12B (refer to Rule 26A) and submit it to your new employer. The employer will take into account the previous salary you earned while deducting tax.

Is Form 16 necessary to file an Income tax return?

Form 16 is one of the most important documents to file the Income-tax return for a salaried person. Form 16 includes all the details of Salary paid, deductions, and tax paid or deducted. Form 16 makes filing the Income-tax return easy. 

Can I file Income tax without Form 16?

Yes, you can file the Income-tax return without Form 16, but it is suggested the employee get his Form 16 from his employer every year. If no Form 16 is issued, the employee can prepare his annual return with the help of his salary slips.

My Form 16 is not showing some of the deductions. Can I claim them in my return filing?

Yes, indeed. If you forgot to report any deductions to your employer, some information might not be present in your Form 16. You can claim the deductions at the time of filing your income tax returns.

Various deductions are not reflected in Form 16 issued by my employer. Can I claim them in my return?

Yes, if you are eligible, you can claim the same.

What is the due date for the issue of these certificates?

Form 16 is issued once in a financial year and the due date of which is by 15th June of the assessment year. For example, the due date for issuing Form 16 for the financial year 2020-21 is by 15th June 2021.

Form 16A is issued quarterly based on the date of deduction, generally within 15 days from the due date for furnishing the TDS return.

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