Filing Income Tax Return is mandatory for anyone who has income in India. The due date to file Income Tax Return for the Financial Year 2017-18 is 31st July 2018. There are times when a taxpayer switches his/her job in the relevant Financial Year. If a taxpayer switches job in a relevant Financial Year, then he/she will end up with more than one Form 16 while filing ITR.
Form 16 is the certificate that contains all the details related to a person’s salary and the Tax Deducted for the relevant Financial Year. Form 16 is divided in to Part A and Part B. Form 16 is the document that s provided to a taxpayer by his/her employer. Part A provides a summary of income credited to an employee and taxes deducted, while Part B contains a detailed break-up of salary paid by the employer to the employee. Thus, Part B of Form 16 helps a taxpayer to compute his taxable salary for the purpose of return of income.
While a taxpayer switches his/her job, then he/she must collect their Form 16 from their previous employer and the current employer while filing their Income Tax Return. There are times when taxpayers get worried about the computation of the taxes, that’s the reason why you should never forget to collect your Form 16 from your previous and current employer while filing ITR.
Why Form 16 is important?
Form 16 is one of the most important document while filing Income Tax Return and the major reason for that is it contains the essential details like details, 1) Gross Salary 2) Allowances / Deduction available from salary 3) Deductions under Chapter VIA and 4) TDS.
The major part in filing Income Tax Return, when a taxpayer has income from multiple employers is factoring of deductions under Chapter VIA. The ITR form provides an independent schedule “Schedule VI-A” where the taxpayers have to report the amount of deduction they are eligible for. In this part the taxpayers are required to be alert and they must ensure that they do not inadvertently add up the amount reported by respective employers.