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Income Tax

New format of Form 16A for Salary TDS Certificate makes it difficult to fudge Income

April 18, 2019 by Team Instabizfilings

New format of Form 16A for Salary TDS Certificate makes it difficult to fudge Income

The new format will allow the tax department to view a detailed break up of the income and tax breaks claimed by a salaried person. 

 

As per the changes notified, Form-16 issued by an employer will have to specify the nature of tax-exempt allowances paid to the employee.

 

The CBDT has notified a new format for Form 16 – the salary TDS certificate – requiring a detailed break up of tax exempt allowances paid to the employee and also of all tax breaks claimed by him/her. The earlier format allowed companies to give consolidated figures or break-up in different formats for both these thereby leaving some ambiguity regarding their individual composition. 

 

Concurrent changes have been made in the format of the TDS return (details of TDS from employees’ salaries) filed by companies with the tax department to allow the tax man to cross check an employee’s ITR, Form 16 and the company’s TDS return easily. 

 

Last year the tax man had detected several cases of false claims of large income tax refunds made by some employees which is likely to be another reason for this streamlining exercise which is aimed at removing all space for such manoeuvres in future. 

 

The new format will allow the tax department to view a detailed break up of the income and tax breaks claimed by a salaried person at the first instance itself. Consequently, any discrepancy between the income and deductions shown in Form 16 and the ITR filed by the person can be immediately spotted. This new format is likely to help the department digitise cross checking of figures too because it takes away the leeway that companies earlier had in providing the break up of income and deductions .. 
 

Click here to read the notification

 

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The information provided in this blog is purely for general informational purposes only. While every effort has been made to ensure the accuracy, reliability and completeness of the content presented, we make no representations or warranties of any kind, express or implied, for the same. 

 

We expressly disclaim any and all liability for any loss, damage or injury arising from or in connection with the use of or reliance on this information. This includes, but is not limited to, any direct, indirect, incidental, consequential or punitive damage.


Further, we reserve the right to make changes to the content at any time without prior notice. For specific advice tailored to your situation, we request you to get in touch with us.

 


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