All salaried employees who fall in the tax bracket as per the slabs set by the Income Tax Department are eligible to get a Form 16 from their respective employers. It is the liability of every Employer to release Form 16 to all Employees from whom tax has been deducted by him. An Employer deducts tax from Employees who fall in the tax bracket and remits it to the Income Tax Department mentioning the Employee’s Pan Card number. Form 16 must be issued by the Employer to all Employees before end of April every year for the previous fiscal year.
Deducting tax component from your salary is the responsibility of the Employers. Employees cannot be held responsible for non-deduction of TDS from their salaries. However, it is important that Employees provide pertinent information regarding their investments to their Employers before the stipulated time frame. This will enable Employers prepare and release the Form 16 in the perfect manner.
Based on the guidelines provided by the Income Tax Department, Employers deduct tax component from the salaries of Employees as per the tax bracket they fall in. Many organizations design the salary structure of their Employees in such a manner so they can save tax in as many aspects as possible. Every Employer calculates the possible allowances based on the purview set up by the Income Tax Department.
It is important that every Income Tax Assessee declares complete information about their investments to their respective Employers in a perfect manner. Providing appropriate proof of investments vide bills and receipts will help the Employer deduct the correct amounts towards TDS. This will help you avoid running behind refund on the excess amounts deducted from your salary towards tax.
Sometimes, either due to your negligence or due to that of the Employer, the Form 16 may not be of help to you to claim exact Tax deductions as anticipated by you. This does not how ever mean that you can never ever be able to claim deduction later on. Your Form 16 is a document that is just issued by your Employer based on his knowledge about your earnings and investments you declare to him. It is not the final verdict. In case you have made certain investments with the intention to save tax and have failed to provide the information to your Employer, declare the same in your ITR Form.
Any slippages that happen in the Form 16 can be taken care subsequently at the time of filing your Income Tax Returns. The Income Tax Department will take into consideration the Tax returns you have filed over and above the Form 16 issued by your Employer. You will get your due refund from the Income Tax Department in due course once the process is over at their end. The time gap between filing your returns and receiving your refund can be reduced based on the correctness of proof you submit.