Forms 16, 16A, 16B and 16C are examples of TDS Certificate types. These certificates are given to the assessee whose income TDS was deducted while making payment by the person who is responsible for the TDS return filing. Keep reading the blog to learn more.
TDS Certificates: What Are They?
When any tax needs to be withheld at the source, TDS certificates are produced. These TDS certificates also assist the assessee in claiming the appropriate tax credit and refunds.
What Does Source Tax Deduction Mean?
TDS (Tax Deducted at Source) is the deduction of tax at the source of income, as the name suggests.
According to this idea, the tax must be withheld at the source from any individual (the deductor) who is required to make a payment of a specific sort to another person (the deductee). As a result, the funds so obtained must be sent to the Central Government’s account. Following this, based on Form 26AS or a TDS certificate given by the deductor, the deductee from whose income tax source deductions have been made would be eligible to get a credit for the amount thus deducted.
Let’s go over TDS Certificate types in more depth.
Form 16: TDS Certificate for Salaried Employees
The different employers of salaried workers issue Form 16 to them. Form 16 is a salary TDS Certificate, in other words.
Situations under which Form 16 Is Issued:
- First off, the Income Tax Act mandates that employers withhold TDS from an employee’s salary and deposit it in the government if the employee’s salary income for the fiscal year exceeds the basic exemption limit of Rs. 2,50,000.
- Secondly, the employer will take into account the entire income for TDS deduction if the person or employee has reported their income from other headings to their employer.
The employee will have more than one Form 16 if they worked for more than one employer during the year.
Form 16 Components
Part A and Part B make up Form 16’s two sections.
- The employer and employee’s information, including name and address, PAN and TAN registration information, job duration, and information on TDS deducted and deposited with the government, is contained in Part A.
- Part B contains information on the salary received, extra income, permitted deductions, and taxes due, among other things.
Release Of Form 16: Deadlines
By June 15 of the year it is being issued, it must be issued.
Aside from Salary TDS Certificate: Form 16A For TDS on Income Other Than Salary, use Form 16A TDS Certificate.
Situations under which Form 16A Is Issued
Form 16A is issued in the following situations: Fixed deposit TDS deductions, insurance commission TDS deductions, rent TDS deductions, or any other TDS-deductible income you may get.
What Time Does Form 16A Issue?
Each quarter, the TDS Certificate, Form 16A, is released. The deadline is the fifteenth day of the month after the deadline for the quarterly TDS return.
Property TDS: Form 16B
When TDS has been taken from real estate, TDS Certificate Form 16B is issued. In this situation, the purchaser must lower the TDS on the property at the time of the sale.
The amount that the buyer must pay the seller is reduced by 1% for TDS. Then, you must deposit that sum with the Income Tax Department.
After the money is deposited with the Income Tax Department, the buyer will issue Form 16B.
This demonstrates that TDS is taken out of the property and deposited with the government.
Form 16B Due Dates
Each quarter, a Form 16B is released. The deadline is the fifteenth day of the month after the deadline for the quarterly TDS return.
TDS Certificate for Rent: Form 16C
The Indian government has introduced a new TDS certificate called Form 16C. It displays the amount of TDS deduction made by the person/HUF on the rent at 5%. (under Section 194IB). Within 15 days of the due date for supplying the challan cum statement in form 26QC. Moreover, the person deducting TDS from the rent must provide Form 16C to the payee.