The Central Board of Direct Taxes (CBDT) has brought Income-tax (3rd Amendment) Rules, 2019. The Major changes were done in Form 16 and Form 24Q via notification dated April 12, 2019.
FORM NO. 16
Form 16 is the format of TDS certificate that an employer issues when TDS is deducted by them. When an employer deducts TDS on salaries, the income tax Act,1961 requires that a certificate must be issued by the employer, where the details of tax deducted and deposited is certified.
Some of the changes which are brought to the form 16 are:
- The New format of Form 16 has a detailed breakup of tax exempt allowances paid to the employee and also of all tax breaks claimed by the employee under Section 80C to 80U. The previous format allowed companies to give consolidated figures or break-up in different formats for both these, which was lacking some clarity.
- The new format will allow the tax department to view a detailed break up of the income and tax breaks claimed by a salaried person at the first instance itself.
- In the New Format, the Income from a last employer has to be reported along with the amount receivable from current employer.
- Standard deduction has also been introduced in the Revised Format.
- These new changes have brought Form 16, TDS returns and ITR 1 in a Sync.
FORM NO. 24Q
Form 24Q is related to the salary TDS return. Form no. 24Q consists of 2 annexures – Annexure I and Annexure II. The CBDT has amended the “Annexure-II” to the Form 24Q. In new Format of Form 24Q, it is mandatory to furnish the PAN of the lender in case any deduction has been claimed in respect of housing loan taken from a person other than a Financial Institution or the Employer. These changes are important so that the department can spot any discrepancies between Form 16 and ITR faster. The new format can also help the department digitize cross checking of figures.
The changes will come into effect from May 12, 2019.
Click here for the notification.
