What is Form 16?

LiveRec EditorialUpdated

Form 16 is the certificate an Indian employer issues each year showing the tax deducted at source from your salary (TDS). You use it when filing your income tax return. Keep a copy each year; new employers and tax filers often ask for it, especially when you change jobs.

What it contains

The Income Tax Department describes Form 16 as a certificate of tax deducted at source on salary. The employer gives it to the employee after the end of the financial year. It shows your income, the deductions and exemptions applied, and the tax deducted, which are used to work out tax payable or refundable.

How to use it

  1. Collect Form 16 from each employer you had during the financial year. If you changed jobs, you may have more than one.
  2. Compare the salary and tax figures with your payslips and with the tax statement on the income tax portal.
  3. Use the figures when you file your return, and keep a copy with your tax records.
  4. If a figure looks wrong, ask your employer's payroll team to correct it and reissue the form.

Common mistakes

  • Waiting until the filing deadline to ask a former employer for the form.
  • Treating Form 16 as the whole story when you also have income from other sources, such as interest. Declare all income in your return.
  • Losing the copy from an earlier job.

When you change jobs

Your new employer may ask for your previous employer's Form 16 or pay details so that tax on your salary is worked out for the full year. Ask your last employer for it when you leave, together with your relieving letter and your full and final settlement details.

Example

Ask for it from your last employer when you change jobs.

Sources

This is general information, not legal, tax or immigration advice. Rules change and your situation may differ. Consult a licensed attorney or qualified adviser.