New Procedure for issuing Form 16 through TRACES

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The Central Board of Direct Taxes of the Directorate of Income-tax (Systems), New Delhi released a notification on 06 May, 2019 prescribing Procedure and format for issuance of certificate of the taxes deducted at source [‘TDS Certificate‘] in the Part B of Form No. 16 through TRACES.

The Form 16 is required to be issued by the deductor [employer] to the deductee [employee] specifying the amount of TDS, PAN of the deductee, TAN of the deductor, etc. The employer shall issue the Form 16 annually by 15 June. TDS Certificate in Form No 16 has two parts viz. Part A and Part B.

Part A contains details of tax deducted and deposit and Part B contains details of income. The CBDT has now prescribed the format and procedure for issue of Part B of Form 16 for taxes deducted at source after 01 April 2018 through TRACES Portal www.tdscpc.gov.in. The procedure for issue of Form 16 through TRACES is as under:

  • To download the Form 16, TDS statement for the fourth quarter i.e. Form 24Q shall be filed first
  • The TRACES will then generated Form No.16 which would have a unique TDS certificate Number.
  • For the assurance of the generation of an accurate TDS certificate in Part B of Form No. 16, the deductor would need to report correct data in Annexure II of Form 24Q.
  • Then, in accordance with sub-rule (6) of Rule 31, the deductor should authenticate the contents of Form No. 16 and verify the same with a signature either manual or digital before issuing the certificate to the deductee.
  • At the bottom of the TRACES generated Form 16 (Part B) are item nos. 2(t) and 10(k) that are to be manually filled-in by the deductor before the handing over the Form 16 to the employee.

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