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How To File Income Tax Return When You Have More Than One Form 16 in a Financial Year?

Thu, 07 Jul 2022 15:20:11 +0000

The Buyt Desk

Salaried people need Form 16 from their employer to file Income tax. If you change jobs in a financial year you will have more than one form 16 from your employers.

For the financial year 2021-22, July 31, 2022, is the last date to file income tax returns (ITR). This is the current deadline and can be extended by the Government. This timeline is for individual taxpayers who do not need accounts auditing. All employers need to have their Form 16 from their employers by June 15, 2022. So that they will have a fortnight of time to file their taxes. The employer must also issue the TDS certificate if there is a tax deduction on salary during the financial year.

What is Form 16?

Form 16 is a kind of Income-tax form. It is a certificate that the employer provides which has details of the salary and TDS of the employee. It has 2 parts where the first part contains details of the employee and employerfile income including their PAN, TAN, name, address, TDS and more. The second part of Form 16 is the financial details including income, allowances, deductions, salary paid, taxable income, tax to be paid and more. This is information of a financial year and issued yearly by employers at least 15 days before the last date to file individual taxes.

When will one have more than one Form 16?

During the financial year, an individual may switch jobs and may switch to any number of companies. In such scenarios, an individual will have a form 16 each from every employer he or she has worked for. While filing an income tax return, individuals will need Form 16 from all employers as only with this the total TDS, total tax exemptions on HRA, LTA and total taxable income can be calculated.

How to file your ITR when you have more than one Form 16?

Now let us look into a step-by-step guide on how to file your ITR if you have more than one Form 16.

The first step would be to collect Form 16 from all employers you have worked with the previous financial year.
Then consolidate all forms to get the gross salary earned by you (add gross salary from each form 16) during that financial year.
Similarly calculate the amount of exemption that you can claim for your income like leave travel allowance (LTA), house rent allowance (HRA) etc.
Now calculate the total HRA, LTA etc by consolidating all form 16s. Use online calculators to know your claim eligibility.
Also, you are eligible for a standard deduction of Rs 50,000 from your salary income. If all form 16 mentions this, then you can consider it only and the rest will be taxable.
Next is to claim deductions under sections 80D, 80C etc.
Now you can arrive at total taxable income which is your salary minus deductions, interest earned and income from other sources. And if you have opted for a new tax regime, you will not be eligible for most of the tax exemptions and deductions.
The next step is to calculate the income tax liability.
Then consider TDS from all Form 16 to know the tax already paid. Cross-check the same with Form 26AS and AIS (annual information statement).
Now the final step is to calculate the tax payable based on the total taxable income, total TDS and the income tax slab.

What to do when you do not get Form 16 from all employers you worked with in the FY?

There is a possibility that you have received Form 16 from one of your employers and not from the rest. In such cases, you need to have salary slips from employers who have not given Form 16. For these salary slips, you need to derive all values as needed by the ITR form. You need to have a clear break up of salary. Now that you have values from all employers, you can calculate the total gross salary which is the summation of Form 16 and salary slip values. Now follow steps 3 to 10 as mentioned above. That means calculating total deductions, total exemptions, total income from other sources, total taxable income, tax liability, total TDS and finally tax payable.

What to do when you do not get Form 16 from any employer?

Irrespective of Form 16 received from the employer, an individual should file his/ her Income Tax Returns. When Form 16 is not available, the Salary slip will do the work. Break the salary from all salary slips to get different values. Now calculate the total gross salary, total income from other sources, total deductions, total exemptions, total taxable income, tax liability, total TDS and finally tax payable as discussed above. Do not forget to consider the income tax slab based on the income tax regime chosen. Also, make sure that the TDS reflected in your salary slips is the same as that in Form 26AS/AIS.

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Planning to file Income Tax Return Keep These 9 Documents Ready

Tue, 28 Sep 2021 04:16:20 +0000

The Buyt Desk

You have to file your Income Tax Return for the financial year (FY)2020-21 by 31st December 2021. Usually, the deadline is in the month of July but this year taxpayers are getting extra time due to two reasons. At first, the government extended the deadline from 31st July 2021 to 30th September 2021 in the wake of Coronavirus. Then a second extension until 31st December was given as the government’s new portal for return filing didn’t function smoothly and needed rectification.

If you are gearing up to file Income Tax Return (ITR) then you will be required to keep a few documents handy. Though when you file an online ITR you never have to attach any documents but you will have to refer to a few proofs of investment and transactions. Keeping these documents ready will help you in minimising mistakes.

There are nine documents in total that you must carry with you when you are filling your Income Tax Return.

1, Form -16 – If you are filing ITR for the first time, you must know about form 16. It is a TDS certificate that the employer issues to an employee. The certificate carries details of the salary that an employer had paid to an employee after the tax deduction and tax exemption, which he is eligible for. It is a mandatory document that an employer issues to an employee if he comes in the tax deduction category.

In case of no TDS deduction, an employee has to request the employer to provide form 16.

2, TDS Certificate and Interest Income – Form 16 comprises two parts: Part A and B. Part A have the details such as your pan number, PAN and TAN of the employer, tax deducted in a year. Part B of Form 16 asks for interest income received from different sources. If you have invested money, you must collect certificates from the respective bodies to gauge the total interest amount you have received in a financial year. Make sure to get certificates from each source even if tax is not deducted. In case of tax deduction, you need to collect your Form 16 or TDS certificate.

3, TDS Certificate From Other Incomes – In the property sell case, the buyer issues Form 16B, providing details of TDS deduction on the amount.

If the landlord is earning via rent, the tenant has to provide landlord Form 16C, having details of TDS deduction. The current law says an individual has to deduct TDS, provided that his monthly rent is above Rs 50,000. You can also check Form 26AS for more details on TDS.

For contractors, there is Form 16D. It is a TDS certificate issued to contractors or professionals when payment is made to them by an individual or HUF exceeding Rs 50 Lakh in the FY 2020-21.

The tax deduction, in this case, takes place while paying the commission, contractual payment, brokerage or professional fee.

For dividends received from companies or equity mutual funds exceeding Rs 5,000, the tax will be deducted. TDS certificate for that should also be with you.

4, Form 26S – Form 26AS is the consolidated annual tax settlement. The form is like your tax passbook having information of all taxes you have deposited against your PAN. It comprises

TDS deducted by the employer
TDS deducted by other organizations from the payment made to you.
The advance tax which you have deposited in FY 2020-21.
Self-assessment taxes.
Tax deducted by banks.

Make sure your Form 26S has all the tax deductions done in FY 2020-21 against your PAN.

5, Expenditure Proofs, Tax-Saving Investment – If you are going with the old tax regime at the time of file income tax return , you must carry documents related to eligible expenditure and investments made during FY 20-21.

The health insurance premium paid for family, spouse or self in FY 2020-21 is also eligible for deduction under section 80D. You need to keep the receipt of the premium paid with you.

The loan statement for FY 2020-21. It includes all types of loans.

6, Captial Gains – Capital gains from the property sale, mutual funds, equity shares require reporting in ITR. Capital gain on house, land or building requires a sale deed or purchase deed.

Capital gain from property sale requires reporting in ITR-2. Here, the seller has to present the full details of the buyer.

Capital gain incurred by mutual funds, shares sale reporting requires a statement from concerning departments or brokers.

Capital gain accrued through the sale of bitcoin also requires reporting in ITR.

7, Aadhar Number – Section 139AA in the income-tax act makes it mandatory for the individual to present his/her Aadhar number while filing the ITR.

8, Investment Details For Unlisted Share – Unlisted shares holding also requires disclosure in ITR. In this case, you need to fill ITR-2 even if your source of income is salary or interest earned on bank accounts and provide the following details

Company name
Company PAN number
Opening balance as on April 1 2020, and acquisition cost.
Unlisted shares acquired in the year with its purchase date, shares face value, per share issue price, per share.
Unlisted shares sold in FY 2020-21 and received amount.
Closing balance on March 31, 2021, and acquisition cost.

9, Bank Account Details – It is a must for the individual filing ITR to provide the account details. It includes bank name, account type, account number and IFSC code.

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