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Pay 10,000/month for 10 years, Get 1,65,805/Year* for next 15 years.
ARN. No. KLI/23-24/E-BB/1201
Features
Ref. No. KLI/22-23/E-BB/999
Form 16A is a TDS certificate issued for non-salary income, such as interest, rent, professional fees, and commissions. It is generated quarterly by the deductor through the TRACES portal and helps recipients claim tax credits while filing ITR. The form includes details like TAN, PAN, payment amount, and TDS deducted. Taxpayers can verify it online to ensure accuracy and avoid discrepancies.
Form 16A is a TDS (Tax Deducted at Source) certificate issued by a deductor (such as a bank, company, or employer) to the person receiving income. It shows the TDS deducted on non-salary income, such as interest, professional fees, rent, or commission, as per the Income Tax Act 1961.
This form helps in filing Income Tax Returns (ITR) by providing details of tax already paid to the government on your behalf.
Form 16A is required whenever TDS is deducted from non-salary income. This includes payments like interest from fixed deposits, professional fees, rent, commission, or contractual payments. If you receive such income and the payer deducts TDS, they must issue Form 16A as proof of tax deduction. It is essential while filing your ITR to claim the tax deducted and avoid discrepancies with the Income Tax Department. Banks, companies, or any entity deducting TDS must provide Form 16A to the recipient quarterly.
The components and specifics that make up the Form 16A income tax are:
All these details that are needed to be mentioned in Form 16A are important when an individual is filing Income Tax returns. The Form 16A, a TDS certificate, carries all the amounts of the TDS nature being deposited with the Income Tax Department.
While filling up the details in 16A, taxpayers should follow these easy steps:
The exemption under TDS is a simple entry that saves your tax from the non-salaried incomes. Enter all the details correctly to enable yourself for the deductions under the tax-saving scheme. It is an important step to file your ITR and make a well-thought-of decision. You should, therefore, be prudent in filling out the forms carefully and accurately.
Form 16A can be downloaded from the TRACES (TDS Reconciliation Analysis and Correction Enabling System) portal by the deductor (the entity that deducted TDS). Here’s the step-by-step process:
If you are the deductee, you can get Form 16A from your bank, employer, or deductor directly.
Verification of Form 16A can help you ensure that the TDS deducted has been correctly deposited with the government and that there are no discrepancies while filing ITR.
You can also cross-check the TDS details with Form 26AS on the Income Tax portal.
Now that you know what Form 16A means, you should gain clarity on the payments for which this form is relevant. As mentioned above, Form 16A is issued for payments where TDS is deducted from non-salary income. All such income sources are given below:
Income Type | TDS Section | Threshold Limit | TDS Rate |
---|---|---|---|
Interest Income | 194A | ₹50,000 (₹1,00,000 for senior citizens) per year | 10% |
Rent Payments | 194I | ₹6,00,000 per year | 10% (land/building), 2% (machinery) |
Professional Fees | 194J | ₹50,000 per year | 10% (professionals), 2% (technical services) |
Commission and Brokerage | 194H | ₹15,000 per year | 5% |
Contractor Payments | 194C | ₹30,000 (single) / ₹1,00,000 (annual) | 1% (individuals/HUF), 2% (others) |
Insurance Commission | 194D | ₹15,000 per year | 5% |
Purchase of Immovable Property | 194IA | ₹50 lakh and above | 1% |
Dividend | 194 | ₹5,000 per year | 10% |
Lottery or Horse Race Winnings | 194B & 194BB | ₹10,000 per year | 30% |
Form 16 and Form 16A are both TDS certificates but apply to different types of income. Form 16 is issued annually to salaried employees by their employer. It details the TDS deducted from their salary and deposited with the government. It also includes a breakdown of salary components, exemptions, deductions under Section 80C, and the final tax liability.
On the other hand, Form 16A is issued quarterly for TDS deducted on non-salary income, such as interest, rent, professional fees, or commission. It contains details of the deductor and deductee, the amount paid, and the TDS deducted and deposited.
While Form 16 helps salaried individuals file their income tax returns, Form 16A serves as proof of TDS deduction for those earning income from other sources.
Form 16A is an important document that helps you prove that tax has already been deducted from your non-salary income. Whether you earn interest from bank deposits, receive rent, or get paid for professional services, this certificate is essential when filing your tax returns. Make sure to collect Form 16A from all sources that have deducted TDS from your payments, verify its details online through the TRACES portal, and keep it handy during tax season. Understanding what is Form 16A and properly using it will help you claim credit for taxes already paid, avoid paying taxes twice on the same income, and maintain a clear record with the Income Tax Department.
1
Any individual or entity receiving income other than salary, such as professional fees, commission, rent, or interest, on which TDS (Tax Deducted at Source) has been deducted is eligible to receive Form 16A.
2
Form 16 is issued to salaried employees for TDS deducted on salary, while Form 16A is issued for TDS deducted on non-salary income such as interest, professional fees, or rent. Both serve as TDS certificates but apply to different types of income.
3
Form 16A includes the deductor’s and deductee’s details (name, PAN, and TAN), the nature and amount of payment, the TDS amount deducted and deposited, and the assessment year for which the tax has been deducted.
4
The entity or individual deducting TDS on non-salary income issues Form 16A to the recipient of the payment. This could be a bank, financial institution, company, or any other deductor responsible for withholding tax.
5
Form 16A is issued quarterly and must be provided to the deductee by the 15th of the month following the end of each quarter (e.g., July 15 for April-June, October 15 for July-September, etc.). It serves as an official document for tax filing purposes.
6
Deductees can obtain Form 16A from their deductor, such as their bank or employer. If they have access to the TRACES portal, they can log in using their credentials and download it, provided the deductor has generated and uploaded it.
7
While Form 16A is not mandatory, it helps in accurately reporting income and TDS details while filing income tax returns. It ensures that TDS credits are claimed correctly, reducing the chances of discrepancies in tax filings.
Pay 10,000/month for 10 years, Get 1,65,805/Year* for next 15 years.
ARN. No. KLI/23-24/E-BB/1201
Features
Ref. No. KLI/22-23/E-BB/999
The information herein is meant only for general reading purposes and the views being expressed only constitute opinions and therefore cannot be considered as guidelines, recommendations or as a professional guide for the readers. The content has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Recipients of this information are advised to rely on their own analysis, interpretations & investigations. Readers are also advised to seek independent professional advice in order to arrive at an informed investment decision. Further customer is the advised to go through the sales brochure before conducting any sale. Above illustrations are only for understanding, it is not directly or indirectly related to the performance of any product or plans of Kotak Life.
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