July 13, 2020

Understanding Form 16A vs Form 16 and How to Download It Online?

Form 16 and Form 16A are two TDS certificates issued upon paying taxes on income from salary and other sources like rent, interest income, professional fees, etc., respectively. 

Form 16

This TDS certificate is issued for deductions against salary. If any individual earns more than Rs.2.5 lakh in a financial year as salary, then his/her employer is liable to deduct tax on his/her salary and submit that amount to the government.

This form proves that an individual has paid his/her tax liabilities. It contains a detailed break-up of the salary and taxes paid in a financial year. Thus, it assists individuals while filing their income tax returns.

Form 16A

This TDS certificate issued for deductions on income from other sources like professional fees, rent, interest income, etc. For instance, if an individual earns interest from his/her fixed deposit, it will incur income tax deductions as per the rate specified by the government. In that case, the financial institution is liable to issue a TDS certificate to the investor that is Form 16A.

Both of these forms act as proof of income and are essential if anyone wants to apply for a loan or credit card.

Steps to download Form 16 and Form 16A

Employers can download both Form 16A and Form 16 online by following the below-mentioned steps –

  1. Visit the TRACES website and then log in by providing the user ID, password, TAN and verification code.
  2. Check the current status of the IT return for the respective financial year of which anyone wants to generate these forms. If the status of their income tax return is either “Processed with Default” or “Processed without Default” then this request will process. 

To check this status, employers have to visit “Statement/Payment” tab and select the financial year and form type, i.e. either Form 16 or 16A.

  1. Click on Form 16 or Form 16A under the “Downloads” tab.
  2. Choose a financial year to generate these two forms and then select either “Search PAN Download” or “Bulk PAN Download” and then click on “Go”. 

“Search PAN Download” is for selected valid PANs. “Bulk PAN Download” is for all valid PANs of that financial year.

  1. The details of the applicant will appear on the screen now. If everything is correct, then click “Submit”; if not, then click “Cancel” and go back to the profile section to update details. Check these details minutely as it will be printed on the final document.
  2. Use either the conventional process or digital signature process to fill up KYC details. The latter can be availed only of the digital signature of the applicant is registered in TRACES website. Otherwise, individuals can opt for the conventional process.
  3. After a successful submission process, a unique “Request Number” will be generated. It is advisable that the employer saves this number for future purpose.

Employers can download these forms once they are in “Available” status. However, if they are in “Submitted” status, then they should check after 24-48 hours to see if it has changed or not.

Note that employers must issue Form 16 to an employee if TDS is deducted from his/her salary. Contrarily, employees not subjected to TDS deduction on salary can request their employers to issue the certificate for Income Tax filing.

These forms act as income proof as they contain comprehensive information about an applicant’s income. It helps financial institutions to evaluate an individual’s income and judge whether he/she can repay their credit card debt or not.

Therefore, failing to submit these forms could be a reason why an applicant’s credit card application was rejected.

Some reputed NBFCs offer credit cards without asking applicants for several documents. Cards like the Bajaj Finserv RBL Bank SuperCard is one such example.

Interested individuals can visit the company website to check the exclusive benefits of a SuperCard that other credit cards do not offers.

Filing the IT returns within its deadline is crucial to avoid incurring penalties. From 16 and Form 16A contains the necessary information to streamline this process.

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