Forms 16 and 16A are crucial for submitting an income tax return. Form 16A is used for TDS (Tax Deducted at Source) for non-salaried income, while Form 16 is often used for salaried persons. Both Forms 16 and 16A assist taxpayers in submitting their income tax returns.

The amount of tax due to tax authorities is calculated using these forms. Both forms serve the same function, making it easier for people to submit income tax returns. This article will cover all you need to know about Form 16 and 16A, which are used to calculate and file income taxes.

Form 16 is, in essence, a summary of a specific employee's tax deductions and compensation information. Along with the breakdown of salaries, it displays the total amount of taxes the employer has withheld.

The employer is obligated by law to provide Form 16 to the employee by the terms of the Income Tax Act. At the latest, this must be completed by June 15 of the next fiscal year. Let's assume that a specific employee's tax deduction occurred during the 2023–24 fiscal year. In this situation, the employer must provide Form 16 on or before June 15, 2023.

When it comes to an individual if their entire income exceeds Rs. 2.5 lakhs, they must pay taxes. The employer is obligated by law to withhold tax from the salaries of salaried workers whose combined income exceeds Rs. 2.5 lakhs. After taking into account the specifics of the employee's other income, tax declarations, exemptions, etc., the employer will deduct taxes.

The employer deposits the tax once it has been taken out of the employee's monthly pay. The employer receives Form 16 after the fiscal year, which details the wage breakdown, tax exemptions, etc.

Simply put, Form 16 is the TDS certificate given for employees based on the amount of tax deducted by the deductor. Part A and Part B of Form 16 are further separated into two parts.

Part A: The information included includes the following:

• Both the employer’s and the employee's personal information
• PAN Details and TAN (Tax Deduction and Collection Amount Number) details.
• Year of assessment for which the tax is paid or deductible.
• The duration of the person's employment throughout the fiscal year
• A list of the salaries
• Date and size of the deduction
• Number of acknowledgements

Part B:

This section of Form No. 16 provides all financial information, including salary received, taxes owed, and taxes paid. The employer's name and PAN information are two other facts. The information contained is listed as follows:

• Whole salary
• Allowances and exemptions
• Gross income is the sum of one's wage and all other sources of income, including rent, home payments, etc.
• Wages deducted
• After all required payments and additional interest amounts have been made, the remaining wage amount is taxable.

• Visit the website of the income tax department.
• Register on the website.
• Click the "Download" tab.
• Choose Form 16
• Choose the correct fiscal year for which Form 16 is required.
• Enter PAN, choose to Add and then click Go to continue.
• For Form 16 to download, click submit.

For the income tax statute, any individual may get income from "salaries" and "other than salaries." If tax is withheld from payment sources other than wages, Form 16A is used as a TDS certificate.

Let's use an example to grasp this concept better. Amit has a one lakh rupee fixed deposit with Union Bank of India. Amit will get interested in his investment throughout the year. In this instance, the bank will withhold tax at 10% and send Amit Form 16A every quarter. Similarly, when TDS is subtracted from rent, insurance commission, etc., Form 16A is generated.

The information on Form 16A includes the name and address of the deductor and deductee, PAN, TAN, and challan information for the tax submitted, as well as the total amount of income generated and the tax deducted on it. Form 26AS contains all the information that is shown on Form 16A.

Forms 16 and 16A are necessary for a flawless income tax return filing process. While Form 26AS does not entirely include the information for the former, it does have the information for the latter.

Form 16A contains the following information:

• Name and location of the deductor
• Name and location of the deductee
• Unique deductor identification (includes PAN and TAN numbers)
• Individually identifiable deductee (includes PAN number)
• Sum total owed to the deductee
• Amount withheld and transferred to the IT Division

• Login to TRACES and provide the necessary PAN, TAN, and other information.
• Navigate to Form 16A - Choose Form 16A from the download menu after logging in.
• Choose a financial year for which a TDS certificate is required and enter your PAN. Form 16A requests may be made by the deductor using Bulk PAN or Search PAN.
• Information about the authorised person When you click on "submit," a preview of the profile information is created and printed off.
• Choose one of the two KYC validation options available to you. Users must choose one of the two alternatives.
• After the KYC validation is complete, a success page is provided with two request numbers that may be downloaded from the website.
• Find the specified download location - To see all requests, enter the Request Number and Date, or choose View All. Select the relevant row. If the status reads "Available," click the download button.
• Download the TRACES tool. From the drop-down option, choose HTTP Download. A zip file containing the file is downloaded. The file doesn't need to be extracted. Go to Downloads > Requested Downloads to obtain requested downloads. Use the "Click here" button to begin.
• Enter the verification code, then click TRACES to download the form 16A utility.
• Open the JAR file after entering the zip file. Enter every piece of information required to download form 16A.

Both documents are TDS certificates that show the revenue from which TDS was withheld. The TAN, PAN, address, financial year, assessment year, income, TDS section, etc., are all shared by both forms.

Each has different rules on who qualifies for which form, who will issue it, and when. You may find more information about the distinctions between Forms 16 and 16A in the table below.

1. Description
A TDS certificate, or Form 16, is given by the employer to the employee and details the income tax withheld at source and the employee's compensation.
A TDS certificate, or Form 16A, shows the tax withheld from non-salary income at the source.

2. Eligibility
An employer-employee connection is required, and the employee must receive remuneration from the employer. (Form 16)
It applies to professionals who work for themselves. (Form 16A)

3. The deadline for issue
After the fiscal year has ended, Form 16 is released. It should be noted that the same must be issued no later than June 15th after the end of the fiscal year.
Each quarter, Form 16A is released.

4. Released by
The employer provides Form 16 to the employee.
Banks, financial institutions, etc., issue Form 16A.

5. Given to
An employee receives Form 16
Persons with non-salary income are given Form 16A.

6. Proper provisions
Section 203 of the Income Tax Act, which addresses the issuance of Form 16 on taxable pay, applies.
Section 203 of the Income Tax Act, which deals with TDS on non-salary earnings, also applies. (Form 16A)

7. Pertains to
This certificate is valid for salaried individuals with taxable income. Additionally, the employer has to have deducted their tax at the source. (Form 16)
Those self-employed or professionals with credentials proving their education are eligible for this certificate. (Form 16A)

8. Document Necessary
Salary slips, PAN cards, and Aadhaar cards must also be submitted with this certificate by the person. (Form 16) With this certificate, people must also provide their PAN cards, Aadhaar cards, and capital gain statements. (Form 16A)

9. Uses
This certificate includes information on bonuses, allowances, and other tax savings disclosed to workers and pertains to pay breakdown. Salary earners may use these facts to file an income tax return. Additionally, this certificate aids in the processing of visas and tax credits. The certificate may also be used as evidence of income by people. (Form 16)
Individuals may use this certificate to submit income tax returns and determine their overall tax obligations. (Form 16A)

10. Time Period
The certificate must be issued by June 15 of the relevant fiscal year. The Government does, however, extend this deadline in certain situations. (Form 16)
The 15th of the month, the day following the deadline for the quarterly TDS return, is when Form 16A is due.

11. Verification
On the website, people may finish the Form 16 verification procedure.
The concerned parties may complete the Form 16A verification procedure through the online portal.

The following are some commonalities between income tax forms 16 and 16A:

• Both forms fall under the same Income Tax Act of 1961, Section 203.
• You may download Form 16 and Form 16A online. Additionally, both forms' verification may be completed online.

The income tax form 16 and form 26AS may have a similar appearance. Still, in reality, form 26AS is used to verify the information included in form 16 and its components, as well as the facts of deductions from salary and other sources of income.

1. Part A:

TDS (Tax Deducted at Source)
TCS (Tax Collected at Source)

2. Part B: TCS information (Tax Collected at Source)

3. Part C: Tax paid information (other than TDS & TCS)

4. Part D: Payback information

5. Part E: AIR transaction information

6. Part F: Details of Tax Deducted on the Sale of Real Property Under Section 194IA (For property buyer)

7. Part G: Defaults for TDS (processing of defaults)

Form 16 and Form 16A help submit an income tax return efficiently at the time of tax computation. Taxpayers familiar with Form 16 and Form 16A will be able to appreciate their significance and use them effectively. They have various small and significant changes that should be considered before submitting the form. Everyone must confirm which category they fall under and register their financial records correctly.