Form 16

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This query is : Resolved

shraddha (Querist)

25 February 2010 Is it compulsory to issue Form 16 to employees who have not taxable income or whose TDS is not deducted?

As many employees are demanding Form 16 for there Loan purpose what ulternate that a company can follow?

regards,

chetan soni

chetan soni (Expert)

25 February 2010 it is not necessary to issue form 16 to all employees, but yes you need to issue this to employees whos TDS has been deducted.

Otherwise you can issue them salary certificate printed on company letter head stating his current salary & joining date.

shraddha

shraddha (Querist)

25 February 2010 Thanks Chetan

Wil plz tell me the section for the same

Sudhindra

Sudhindra (Expert)

25 February 2010 Form 16 is the proof that ur an employee of that company and also it serves as the purpose for the Income declaration in the absesnce of Salary slips or the salry statement whichis issued to all the employees . Hence it is a proof of the entire years income and also the allowances, in short it is a compendium of the salary and the allowances attached to it which is paid to the employees for a given financial year. It is mandatory as the provisions of Income tax act 1961 to issue form 16 as per section 192

Should u have any queries pls feel free to ask the same....

CA.Tarun Maheshwari

CA.Tarun Maheshwari (Expert)

25 February 2010 Yeah. If the employee demands, then its compulsory to issue TDS certificate. If it is NIL, then you can chose any option, either issue a NIL TDS Form 16, or give a salary certificate on company's letterhead. Both theoptions are equally valid.