Part B of Form 16 will also be made available by TRACES

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Reading the Topic of post many of you must be wondering what is Part B of Form 16 and how is it important. So let me first tell to you the importance and content of Part B of Form 16. Now Form 16 as we all know is a TDS certificate which shows tax deducted in case of salaried employee, it is issued by employer to its employee. This Form 16 has two parts Part A and Part B. Part A consist of total amount of income shown in each quarter and total TDS deducted on same. Now Part B is more important because it contained detailed bifurcation of total salary income, HRA included, Bonus, deduction under VI A considered by employer basically its the complete break of salary income and total income on which tax has been calculated by employer and how TDS has been deducted. Earlier this was created by all employers offline and some used to give it to employee and some would not and also it would be in different formats and after the recent amendments made by CBDT applicable from F.Y. 2018-19 in Form 16 it has now announced that now deductor or employer needs to also download Part B of Form 16 from TRACES website. Earlier the employer used to only download part A of Form 16 which used to contain only the tax details and part B was prepared by the employer himself on his software or excel etc, due to which different employers were provided different information in Part B of Form 16 and there was no fixed format.

However now after this amendment all the employers will have to submit proper break of income in fourth quarter form 24Q, under Annexure II of Form 24Q and on the basis of that information Part B of Form 16 will be prepared by TRACES and then employer need to download the same and provide it to employee either by attaching digital signature or manually signing it.

There are two points which employer will have to fill later, if applicable i.e. point number 2(f) and 10(k).

Point number 2(f) talks about any exemption u/s 10 of the Income Tax Act other than those already mentioned above and point 10(k) talks about any deduction Chapter VI A.

Therefore now Part B of Form 16 will be more detailed and in same format from every employer and thus it will be now simple for employees to file their income tax return and also after introducing this new format of Form 16 Income tax department now also provide pre-filled ITR 1 in many cases where you have to just check the ITR and submit.

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