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Filing your Income Tax Returns or ITR can be cumbersome when you have multiple Form 16. This can happen when you have switched jobs or have more than one employer. But that is no reason to worry! Let’s run through the solution on how to file ITR with two Form 16.
The format of Form 16 is decided by the Income Tax Department and remains constant across India. It can be downloaded online from the TRACES website. Form 16 has two parts namely, Part A and Part B. Part A of the form consist of the details of tax deducted and deposited to the government through TDS (Tax Deducted at Source). This section also contains the TAN (Tax Deduction and Collection Account Number) of the employer who has deducted the tax. Part B of Form 16 contains a detailed breakup of your salary, allowances exempted under Section 10, and income tax deductions that have taken place like financial investments, donations, interest earned, etc.
You could have a situation that has led you to deal with multiple Form 16 between a financial year. So, how to file ITR without mixing up the taxes? Let’s go through a step-by-step procedure given below:
Your current employer has to be aware of your previous job if you have had a job change in that particular financial year. If your current employer is not aware of your previous employment, then the taxes by the current employer will be miscalculated as they will only consider the salary they are paying you. Notifying your company about your previous salary eliminates any kind error in computing your taxes.
You have to consolidate the income received from all employers for that particular financial year. If you do not include certain income in the ITR, you can get a notice by the income tax department for not reporting the salary as it is taxable irrespective of TDS being deducted or not.
You have to calculate the allowances that are exempt from tax like House Rent Allowance (HRA) or travel allowance. As the salary structure changes with every job, you may or may not have HRA and if you do, the amount may change. But you can still claim this allowance in ITR if you are not being paid HRA. You have to calculate the amount of house rent exempted for that year from the various income and get refunded in case excess tax was deducted.
After you have combined the incomes earned by you in that particular financial year, you will also have to combine the tax deducted. If you have invested your money in any tax-saving financial instruments, you can claim those deductions under the specific sections like Section 80C. You also need to maintain the documents and proofs related to the income tax deductions for future reference.
Your Form 26AS contains all the details regarding the TDS deducted from your salary each month by all the employers. This form comes in handy to cross-check your tax calculation and deduction. In case of some mismatch, it should be immediately brought to the notice of your employer and have it resolved before filing your ITR.
There may be some tax dues that are pending when you check due to inaccurate calculation of taxes. This miscalculation could be due to the benefit of tax-saving deduction allowed by more than one employer or the minimum exemption limit allowed by all employers. To avoid this, you can submit Form 12B to your current employer which gives them access to your salary break-up and deductions.
Your employer has to provide you with Form 16 but if they do not, you can request the HR department for one. If you still cannot get your hands on the form, you can calculate the taxes with the help of your salary slips and Form 26AS.
You may have found this procedure tedious which is why there is an easier method of doing this. You could hire a CA or a tax lawyer to sort out this situation with multiple Form 16 for you. This could cost you some money but with the help of an expert, you would be able to file your tax returns with any doubts.
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