Form 16 is a crucial document for salaried individuals filing their Income Tax Returns. It provides information about tax deducted at source (TDS) by the employer and a summary of the salary paid.
To ensure accurate filing, it is important to review Form 16 thoroughly and cross-verify the following details
1. Check the tax regime
Verify the tax regime considered for computing Form 16. Compare different tax regimes using an income tax calculator, considering exemptions and deductions, to determine the most beneficial regime for you.
2. Confirm deductions and exemptions
Ensure that all the deductions and exemptions you are eligible for have been correctly included in Form 16. These deductions, covered under chapter VIA, could include investments in tax-saving instruments like provident fund, life insurance, National Pension Scheme, or deductions for education loans, medical insurance, and more. If any deductions are missing, you can claim them while filing your return.
3. Verify PAN and personal details
Check that the PAN mentioned in Form 16 matches your actual PAN. Additionally, review your name, address, and employer's TAN (Tax Deduction and Collection Account Number) and PAN (Permanent Account Number) to ensure accuracy.
4. Review Part A and Part B of Form 16
Thoroughly review Part A of Form 16, which provides a summary of taxes deducted by your employer as TDS. Cross-verify these details with your Form 26AS and Annual Information Statement (AIS) to ensure consistency and accuracy. Pay attention to details like employer's TAN, the assessment year, and the period for which the TDS has been deducted. In Part B, carefully review the breakdown of your salary income, allowances, perquisites, and deductions claimed, which will determine your taxable salary income.
5. Cross-verify tax deductions
Compare the amount of tax deducted from your salary income, as mentioned in Form 16, with the details available in Form 26AS and AIS. If you notice any discrepancies, promptly inform your employer and request them to rectify the information in Form 16. Ensuring that the accurate details align with Form 26AS and AIS is essential.
6. Job changes and multiple employers
If you have changed jobs during the financial year, make sure to collect Form 16 from all your employers. This will help you accurately determine your taxable salary and ensure proper reporting. Inform your current employer about the income earned from previous employers to avoid potential issues related to tax payments.
7. Validate Form 16 with salary slips
Cross-check the information provided in Form 16 with your monthly salary slips or pay stubs. Ensure that the salary figures, allowances, and deductions match between the two. This step will help identify any discrepancies that need to be addressed with your employer.
By meticulously reviewing and verifying the information in Form 16, cross-checking it with other relevant documents, and promptly addressing any discrepancies, you can ensure the accurate filing of your Income Tax Return. Consider consulting a tax professional or using online tax filing platforms to ensure the correctness and completeness of your filing. Filing your taxes accurately and on time will help you avoid potential issues with the income tax department and ensure compliance with the tax laws.
The author is a Chartered Accountant with 2 decades of experience into Accounting, Taxation, Auditing, Risk & Compliance, Credit Controls, Due diligence. Currently, the author is the founder and managing partner at RRL Global services.
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