Form 16 is an essential document for salaried individuals when filing their income tax returns. Here’s a breakdown of the details required from Form 16 while filing your return:
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Allowances exempt under Section 10: Form 16 provides details of any allowances that are exempt from tax under Section 10 of the Income Tax Act. These may include allowances like house rent allowance (HRA), conveyance allowance, etc.
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Breakup of deductions under Section 16: It outlines the deductions allowed under Section 16 of the Income Tax Act, which includes standard deduction (if applicable) and any professional tax paid by the employee during the financial year.
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Taxable salary: This section provides information on the total salary earned by the employee during the financial year, after deducting any exempt allowances and deductions under Section 16.
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Income (or admissible loss) from house property reported by an employee and offered for TDS: If the employee owns a house property and has reported income or loss from it, this information will be provided in Form 16.
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Income under the head ‘Other Sources’ offered for TDS: Any income earned by the employee under the head ‘Other Sources’, such as interest income from savings accounts or fixed deposits, is mentioned here.
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Breakup of Section 80C deductions: Form 16 provides details of deductions claimed under Section 80C of the Income Tax Act, which includes investments made in instruments like Provident Fund (PF), Public Provident Fund (PPF), Equity Linked Savings Scheme (ELSS), etc.
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Aggregate of Section 80C deductions (gross and deductible amount): It shows the total amount of deductions claimed under Section 80C, both the gross amount and the deductible amount.
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Tax payable or refund due: This section summarizes the total tax payable by the employee after considering all income, deductions, and exemptions. It also indicates whether there is any tax refund due to the employee or if they need to pay additional tax.
