Form 16 vs. salary certificate

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This query is : Resolved

Asaithambi S (Querist)

11 June 2013 Dear Experts,

I hope that Form 16 need not be issued by the employer to the employees whose taxable income is not more than exemption limit. Also, I hope, even in a situation where Gross Total Income exceeds exemption limit, it is not need to issue Form 16.

Can you please share the Section/CBDT Circular details where it says to issue/not to Form 16 in such a situation?

This is just to have the knowledge what Act says in such a situation please.

Thanking you,
Regards,
Asaithmbi S

Asaithambi S

Asaithambi S (Querist)

11 June 2013 ...Also, I hope, even in a situation where Gross Total Income exceeds exemption limit, it is not need to issue Form 16, if taxable income does not exceed exemption limit.

Can you please share Section/CBDT Circular...

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

11 June 2013 Form 16 is mandatory issue for the employee those are deducted tax. refer Income tax rule rule 31(1)(a)

Other employees is option of the employer

Asaithambi S

Asaithambi S (Querist)

12 June 2013 Dear Ramesh,

The Rule you mentioned is only a mandatory provision which is applicable for the employees from whom tax deducted on salary.

My request is to share the Section, Circular or any other reference in law where it says it is optional to issue Form 16 to case where tax not deducted when no taxable salary.

Regards,
Asaithambi S

Asaithambi S

Asaithambi S (Querist)

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

12 June 2013 Income tax act provided that when the tds deducted, what certificate need to be issued.

but there is no such notification or circular. no need to issue certificate if you not deducted or income is exempted. so if you not deducted the option is yours whether you can issue or not issue

Asaithambi S

Asaithambi S (Querist)

12 June 2013 Thank you for your advise please.

Asaithambi S

Asaithambi S (Querist)

13 June 2013 I have got clarification myself for this query.

Each and every year CBDT issues TDS circular for Section 192. That specifically clarifies that there is no obligation to issue the TDS certificate in case tax at source is not
deductible/deducted by virtue of claims of exemptions and deductions.

Ref: Point No. 4.6.1 at CIRCULAR NO. 05/2011 [F.NO. 275/192/2011-IT(B)], DATED 16-8-2011

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