CBDT notifies changes in Form 16
New Delhi, Apr 18 (KNN) The Central Board of Direct Taxes (CBDT) has notified changes in Form 16, the certificate issued by employers for tax deducted at source (TDS) for salaried employees, seeking disclosure of more details, especially about exempt allowances.
Details of exempt allowances will be disclosed as separate line items — such as leave travel allowance (LTA), house rent allowance (HRA), death-cum-retirement gratuity, to name a few. Salary from previous employers, if any, during that particular financial year, will also be separately disclosed.
Revisions will come into force from May 12, 2019. Typically, for a particular financial year, employers issue Form 16 in May or June.
Thus, it is likely that most employers will have to adopt the new form for the financial year ended March 31, 2019.
CBDT has also announced amendments to Form 24Q, a quarterly TDS statement on deductions against salary income that is filed by the employer.
This also requires additional details, many of which are similar to those in the new Form 16.
Deductions claimed by the employer under chapter VI-A of the Income Tax (I-T) Act will be reflected in detail.
These include contributions under section 80C such as life insurance premium paid or contribution to public provident fund, under section 80D for health insurance premium, and under section 80E for interest on loans taken for higher education.
Standard deduction was reintroduced by the Union Budget 2018 for the financial year 2018-19 onwards.
Thus, the amendments in the form have also captured its disclosure. (KNN/JM)