Explained the Concept of Form 16 and How to Get It
Form 16 is something which every salaried individual knows about for it serves as the certificate that tax has been deducted at the source which is also known as TDS. It is issued on or before the 15th of June on the year following the financing year in which the tax was deducted. If under any circumstances, you happen to lose your copy of Form 16, a duplicate can be issued by your employer.
Form 16 has been divided into two parts - Form 16A and Form 16B. They have been explained as follows -
Form 16A
There are many sources of income wherein a salaried individual can have other sources of income apart from the salary that person gets. This can be returns from investments which have been made such as mutual funds, shares, bonds, and fixed deposits to name a few.
Many of these investments incur income tax owing to their amount and this is why Form 16A is issued. The rates of income tax on these investments are determined by the Government and are revised from time to time. For this reason, it is more than necessary to know the slabs and the applicable interest rates.
Form 16B
Any immovable asset which is sold such as a building or land (except agricultural land) accrues income tax. This tax needs to be deduced at the source of the income generated due to selling of the property, in other words from the person selling the property. Form 16B is what is issued here to signify that the income tax generated will be deposited with the income tax department.
February 19th, 2019