Hi all I want to know what is the use of form 16 and for whom it is required. Please help me out with this. Regards Vignesh
From Ireland
1From Ireland
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Hi,
If you are a salaried employee in an organization, you will receive your salary after tax deduction by the employer. This process is known as Tax Deduction at Source (TDS). Every company is required to have a Tax Identification Number (TIN). The TIN is issued to the person responsible for deducting tax on payments made to employees.
At the end of the financial year, the company must issue a Form 16 which includes details about the salary earned by the employee and how much tax was deducted. This form contains monthly details. Simply put, Form 16 provides information about the tax deducted by the employer on behalf of the employee, which is then paid to the government by the company. Many people believe that receiving Form 16 alone is sufficient for filing taxes. However, taxpayers must use Form 16 to file their income tax return at the end of each financial year.
From India, New Delhi
If you are a salaried employee in an organization, you will receive your salary after tax deduction by the employer. This process is known as Tax Deduction at Source (TDS). Every company is required to have a Tax Identification Number (TIN). The TIN is issued to the person responsible for deducting tax on payments made to employees.
At the end of the financial year, the company must issue a Form 16 which includes details about the salary earned by the employee and how much tax was deducted. This form contains monthly details. Simply put, Form 16 provides information about the tax deducted by the employer on behalf of the employee, which is then paid to the government by the company. Many people believe that receiving Form 16 alone is sufficient for filing taxes. However, taxpayers must use Form 16 to file their income tax return at the end of each financial year.
From India, New Delhi
Form 16 is issued by the company to an employee for whom the payroll tax has been deducted and remitted to the tax department on behalf of the employee.
Form 16 is a certificate issued by the company giving the details of the earnings by the employee and the tax deduction and remittance to the tax department. This needs to be used by the employee to file the individual income tax returns.
Hope this helps. Thanks, Showri
From India, Faridabad
Form 16 is a certificate issued by the company giving the details of the earnings by the employee and the tax deduction and remittance to the tax department. This needs to be used by the employee to file the individual income tax returns.
Hope this helps. Thanks, Showri
From India, Faridabad
Hi,
Thanks, Garima and Showri. I hope you are the experts in the business. If possible, can you brief me on the process of filing returns? I am a fresher to the job, and I feel that knowing these details is extremely necessary for my role. I would indeed be thankful for the same.
Regards,
Vignesh. R
From Ireland
Thanks, Garima and Showri. I hope you are the experts in the business. If possible, can you brief me on the process of filing returns? I am a fresher to the job, and I feel that knowing these details is extremely necessary for my role. I would indeed be thankful for the same.
Regards,
Vignesh. R
From Ireland
Dear Vignesh,
First of all, you should know some basic details such as:
1. Financial Year - Always starts from 1st April to 31st March. The current financial year is 1.4.10 to 31.3.11.
2. Tax deduction - The company has to deduct tax on a monthly basis if your income exceeds 1.60 Lakhs PA at the following rates:
- 0 to 1.60 lakhs - 0%
- 1.60 to 5 lakhs - 10% - Tax amount of Rs. 34,000
- 5.00 to 8 lakhs - 20% - Tax amount of Rs. 60,000
- Above 8 lakhs - 30%
If your taxable income is 8.50 lakhs PA, then the tax is calculated as 94,000 for up to 8 lakhs and then 30% of 50,000, which is 15,000. The total tax amount of Rs. 109,000 + Education cess of 3% on (109,000), i.e., 3,270 = 112,270/- would be deducted over a period of 12 months starting April.
During May 2011, the company will issue Form 16 showing the total income and total tax deducted and remitted to the Tax department.
You need to file the Income tax returns after receiving Form 16 from the company before 31st July 2011.
You can file your returns online through myitreturns.com or Online Income Tax Filing | Income Tax Returns | Income Tax Planning | Tax Savings | Income Tax Return Filing | Tax Filing Information | Tax Returns Services or any other portal, which is straightforward. You just have to replicate the information from Form 16 and submit it online. There is a nominal fee for the services provided by the portal. You can visit the portals to find out more details for filing the online returns.
Hope this helps...
From India, Faridabad
First of all, you should know some basic details such as:
1. Financial Year - Always starts from 1st April to 31st March. The current financial year is 1.4.10 to 31.3.11.
2. Tax deduction - The company has to deduct tax on a monthly basis if your income exceeds 1.60 Lakhs PA at the following rates:
- 0 to 1.60 lakhs - 0%
- 1.60 to 5 lakhs - 10% - Tax amount of Rs. 34,000
- 5.00 to 8 lakhs - 20% - Tax amount of Rs. 60,000
- Above 8 lakhs - 30%
If your taxable income is 8.50 lakhs PA, then the tax is calculated as 94,000 for up to 8 lakhs and then 30% of 50,000, which is 15,000. The total tax amount of Rs. 109,000 + Education cess of 3% on (109,000), i.e., 3,270 = 112,270/- would be deducted over a period of 12 months starting April.
During May 2011, the company will issue Form 16 showing the total income and total tax deducted and remitted to the Tax department.
You need to file the Income tax returns after receiving Form 16 from the company before 31st July 2011.
You can file your returns online through myitreturns.com or Online Income Tax Filing | Income Tax Returns | Income Tax Planning | Tax Savings | Income Tax Return Filing | Tax Filing Information | Tax Returns Services or any other portal, which is straightforward. You just have to replicate the information from Form 16 and submit it online. There is a nominal fee for the services provided by the portal. You can visit the portals to find out more details for filing the online returns.
Hope this helps...
From India, Faridabad
Hi Showri Thanks for the inputs. Could you brief me what is an Education Cess and why some percentage is added to the tax. Thanks again for your patient reply. Regards vignesh. R.
From Ireland
From Ireland
Dear Vignesh,
The Education cess is a levy of tax by the Government of India, and this amount is exclusively used for development in the education sector. The percentage is decided by the Government and is reviewed on a yearly basis during the time of the Union Budget.
You should try to Google these things where you may get more information or a detailed explanation.
Thanks
From India, Faridabad
The Education cess is a levy of tax by the Government of India, and this amount is exclusively used for development in the education sector. The percentage is decided by the Government and is reviewed on a yearly basis during the time of the Union Budget.
You should try to Google these things where you may get more information or a detailed explanation.
Thanks
From India, Faridabad
Hi showri, thanks for providing such valuable information. I still have a doubt. I understood up to filing tax returns. After completing the filing of tax returns, what do we need to do? What is the purpose of filing tax returns? I lack full knowledge, which is why I am asking you.
Thanks & Regards,
Murali Krishna.
From India, Kurnool
Thanks & Regards,
Murali Krishna.
From India, Kurnool
thanx a lot. this will be very useful for me. i am completely fresher in hr. please send me some tips to manage the people. i am now in Gupta Power Infrastructure Ltd.
From India, Bhubaneswar
From India, Bhubaneswar
Thank you very much for all your appreciation. I am happy that it was useful to many of you.
As regards to one of the questions: what happens after filing the Tax returns, the answer is that the filing of Tax returns is an obligation on the part of every individual, corporate firms, and others who have income from various sources like salaries, income from business & profession, etc., to file the Income tax returns on a yearly basis.
This is to ensure that individuals & companies are disclosing their earnings/revenue/profit and also ensure payment of tax on the same.
If you pay the taxes regularly and do not file the returns, then how will the government know that you have paid the taxes correctly and also have disclosed the actual earnings/profits.
The Income tax returns are very useful in the future for any loans you may want to borrow from a bank, for applying for a passport, etc. Every bank will ask for Tax returns filed for the past 3 years in case you go for a loan.
Hope this helps.
Thanks,
Showri
showri.rajan@in.ey.com
+919900103820
From India, Faridabad
As regards to one of the questions: what happens after filing the Tax returns, the answer is that the filing of Tax returns is an obligation on the part of every individual, corporate firms, and others who have income from various sources like salaries, income from business & profession, etc., to file the Income tax returns on a yearly basis.
This is to ensure that individuals & companies are disclosing their earnings/revenue/profit and also ensure payment of tax on the same.
If you pay the taxes regularly and do not file the returns, then how will the government know that you have paid the taxes correctly and also have disclosed the actual earnings/profits.
The Income tax returns are very useful in the future for any loans you may want to borrow from a bank, for applying for a passport, etc. Every bank will ask for Tax returns filed for the past 3 years in case you go for a loan.
Hope this helps.
Thanks,
Showri
showri.rajan@in.ey.com
+919900103820
From India, Faridabad
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