Are you filing Form 16? Why must take note of these latest changes in TDS certificate procedure

The Central Board of Direct Taxes has once again brought in changes to the Form 16 format. Recently, the regulator made some alterations to this form by making it more comprehensive and transparent. Last week, CBDT issued a notification to highlight the procedure, format and standards for issuance of certificate for tax deducted at source in Part B of Form 16. There are two sections of Form 16 namely Part A which contain details of tax deduction and deposit, and Part B (Annexure) having information of income. An employer issues this Form. It contains the evidence of TDS which is deducted from your salary and deposited with authorities. Issued annually on or before June 15 of every year, the Form contains information needed to file your ITR. 

Here’s the latest changes in Form 16, as per CBDT. 

1. To ensure generation of accurate TDS certificate in Part B of Form No. 16, the deductor(s) need to report correct data in Annexure II of Form 24Q. The TRACES generated Form No. 16 shall have a unique TDS certificate number. 

2. The deductor, issuing the TDS certificate in Form No. 16 by downloading it from the TRACES Portal, shall, before issuing to the deductee authenticate the correctness of contents mentioned therein and verify the same either by using manual signature or by using digital signature in accordance with sub-rule (6) of Rule 31. 

3. The item nos. 2(t) and 10(k) in Part B (Annexure) of Form 16 required to be filled-in by the deductor manually shall be made available at the bottom of the TRACES generated Form 16 (Part B) and the deductor shall duly fill details, where available. The Form 16 item no 2(f) includes details of other exemption under section 10. While the forms item no 10(k) includes details of amount deductible under any other provisions of chapter VI-A.

4. The deductors who opt to authenticate Part B of Form No. 16 manually will be provided with the download of the Part B of Form No. 16 along with these item nos. 2(f) and lO (k) appearing at the bottom of the Form. The deductor shall duly fill details, where applicable, in item numbers 2(t) and 10(k) before furnishing of Part B (Annexure) to the employee.

5. The deductors who opt to authenticate Part B of Form No. 16 using Digital Signature Certificate (DSC) will be provided with the download of Part B of Form No. 16 without item nos. 2(f) and 10(k) and therefore these details shall be required to be prepared by the employer and issued to the employee, where applicable, before furnishing of Part B to the employee. 

The part B of Form 16 has been changed. A new section 10 has been added, which covers information of travel concession, death-cum retirement gratuity, pension, leave salary encashment and house rent allowances. Apart from this, new columns have been created for any other exemptions under section 10. Further, new columns were launched for sections like 80E,  80G, 80TTA and others. Earlier, information for these sections for optional and had only one single column.