Form 16 is essentially a certificate that shows the tax amount deducted from the salary of an individual. Typically, employees who are eligible for income tax payment against their salary receive this document from their employers.
Form 16 has two parts, and the difference between 16A and 16B is vital to be aware of. Here is a brief overview of each –
- Form 16A
Form 16A offers a summary of the total tax deducted at source from sources other than salary of an employee. It contains personal details of an employee and the employer, Assessment Year, employment period, tax deduction and submission date, and acknowledgement number.
- Form 16B
Form 16B is a TDS certificate for the sale of immovable property other than agricultural land. It also provides a consolidated overview of a salaried individual’s total annual income. Along with the salaried income, this form reflects an individual’s total tax payable as well.
This form contains details such as net salary, gross income, exemptions, deductions, tax amount due, etc.
The difference between 16A and 16B is significant. Both of them offer information on income tax deductions but include different segments. Thus, it is crucial to know these dissimilarities as they will reduce the confusion during ITR filing.
Form 16 is also an important financial document for salaried individuals as it doubles up as income proof. So, while applying for a credit card like Bajaj Finserv RBL Bank SuperCard, applicants can present it as their proof of income.