After deduction of tax, the tax deductor is required to issue to the person from whom such tax is deducted, a tax deduction certificate in prescribed Form (Form No. 16 or Form No. 16A) normally within prescribed period. Prescribed forms are as under:
| Form No.16 | For deduction of tax at source from Salary payments. |
| Form No.16A | For deduction of tax at source from all other types of payments such as interest payments, winnings from lotteries, payments to contractors, dividends, insurance commission, commission or brokerage, rent, fees for professional or technical services etc. |
Time limit to issue certificate :
Notification No. 41/2010 [F. No. 142/27/2009-SO (TPL)], dated 31.5.2010 has amended Rule 31. This amendment is applicable only in respect of tax deduced on or after 1st day of April, 2010.
| Sr.No | Form No. | Periodicity | Due date |
| 1. | 16 | Annual | By 31st day of May of the financial year immediately following the financial year in which the income was paid and tax deducted |
| 2 | 16A | Quarterly | Within fifteen days from the due date for furnishing the statement of tax deducted at source under rule 31A. |
The certificate shall specify
(a) Valid permanent account number (PAN) of the deductee;
(b) Valid tax deduction and collection account number (TAN) of the deductor;
(c) (i) Book identification number or numbers where deposit of tax deducted is without production of challan in case of an office of the Government.
(ii) challan identification number or numbers in case of payment through bank. (challan identification number means the number comprising the Basic Statistical Returns (BSR) Code of the Bank branch where the tax has been deposited, the date on which the tax has been deposited and challan serial number given by the bank.
(d) (i) Receipt number of the relevant quarterly statement of deducted at
Source which is furnished in accordance with the provisions of rule 31A;
(ii) Receipt numbers of all the relevant quarterly statements in case the statement referred to in clause (i) is for tax deducted at source from income chargeable under the head “Salaries”. If an assessee is employed by more than one employer during the year, each of the employers shall issue Part A of the certificate in Form No. 10 pertaining to the period for which such assessee was employed with each of the employers and Part B may be issued by each of the employers or the last employer at the option of the assessee.
Observation:-
1. Form Nos. 16 may be issued by tax-deductors in prescribed format on their own stationery including computerized stationery and Form No 16A to be generated through system only.
2. The TDS certificate to be issued shall be duly verified and certified to the effect that tax has been deducted at source and paid to the credit of Central Government specifying the amount so deducted, the rate at which deducted and such other particulars (correct name, address, PAN & TAN of both tax deductor and recipient of income, TDS circle where return u/s. 206 to be filed, period for which such certificate is issued and corresponding assessment year acknowledge of the return filed)
3. Two copies of TDS certificate should be prepared for each payee (recipient of income). Original/ first copy should be issued to the person (recipient of income), second/duplicate copy to be retained by deductor as office copy
4. Where the original is lost, the assessee (payee) may approach the tax deductor for issue of duplicate certificate. Tax deductor may issue duplicate certificate on a plain paper (mentioning of top “duplicate certificate”) giving necessary details as contained in respective Form No. 16 or Form No. 16A.. Assessing officer shall, however, give credit of TDS only after payment verification from designated officer and after obtaining indemnity bond from the assessee.
5. Even where the payer of income agrees to bear the tax on such income and makes payment only ‘net of tax’ or where under an agreement/ arrangement, the tax chargeable on any income is borne by the payer of income, he is still under an obligation to furnish a (TDS) certificate for the tax deducted at source in the prescribed format to the payee within prescribed time. [Circular no. 785, dated 24th November 1999]
6. Payee (recipient of income) can verify his TDS through NSDL Website through 26AS
Penalty-
If certificate is not issued in time as prescribed the pay in is liable to penalty of Rs. 100. Per day to each day of default.
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