Income Tax

Filing ITR Online without Form 16: Step by Step Procedure

You may have heard salaried employees asking for Form 16 to file their annual Income Tax Return. However, very few know that one can file ITR online even without Form 16. In this article, we shall discuss the complete procedure of how a salaried employee can file ITR online without Form 16 but before that, let’s understand what is Form 16.

Overview of Form 16

It is a vital document that has to be issued by all employers to their employees. It is a TDS certificate that provides for the taxable income of an employee and deductions also. Whenever an employee deducts TDS on salaries, the income tax provides that a TDS certificate should be issued by the employe, once a year, on or before 15^th June of the financial year following the financial year when the tax was deducted.

There may be instances where employers may not issue Form 16 to employees whose taxable income doesn’t exceed the basic exemption limit. However, all salaried employees, whether they receive Form 16 or not, are required to file annual Income Tax Return if their gross income is more than the basic exemption limit.

Circumstances where the employer may not issue Form 16

It is worth mentioning here that TDS certificate in Form 16 is issued to the employee when TDS is deducted, and if no TDS deduction has been made by the employer, he will not issue you a Form 16.

The employer must issue Form 16 after TDS deduction, and if he fails to do so, then an employee can complain to the Assessing Officer, and necessary actions shall be taken against the employer.

Filing ITR online without Form 16: Procedure

So now let us look at the step by step procedure of how you can file the income tax return without Form 16.

• Determine income from all sources

The first step is to determine your income from all sources which is earned in a financial year. You may do so by refering to your monthly pay slips and calculate the salaried income or pension income. If you shifted from one job to the other, then ensure to include the income earned from your previous employer.  The salary slip should include details such as TDS deducted, House Rent Allowance, PF Deductions, Professional Tax Deductions, Allowances exempted under section 10 etc.

Include other income such as rental income from house property, capital gains on the sale of any capital asset, FDs etc. You can also get the interest certificate from banks if there is any interest income or refer bank statements to include all other incomes earned by you in that financial year.

• Form 26AS and calculation of total TDS deducted

If your income is subject to TDS, then cross-check the TDS amount reflected in the payslips with Form 26AS. Calculate the TDS deducted by your employer and then match the amount with Form 26AS. Form 26AS shall contain the details of the total TDS deducted under PAN. It may be noted that Form 26AS is a tax credit statement which is available on the TRACES website^[1]. You can download it directly by logging in through the Income Tax portal.

• Claim Deductions

In case where you submitted tax saving investment proofs, then the employer may have taken it into account before TDS deductions.

Collect statements for tax saving investments such as the ELSS funds, tax saver FDs, life insurance policy, PF, medical insurance etc. Note that before you claim the PF deduction, claim deductions under Section 80C, 80D and 80G. Each deduction shall have a threshold limit, and in case you avail any house loan, then you need to claim the house loan interest deduction under the house property head.

• Calculate total taxable income

When you claim all deductions, after that, calculate the total taxable income. You may do so by deducting it from the total income earned in a year.

• Calculate Tax Liability

The next step is to calculate the tax liability. It can be calculated by applying the individual tax slab rates applicable to the taxpayer.

The Income Tax Department makes changes to the slab rates. For instance, the government introduced the new tax regime with lower slab rates than the previous one for AY 2021-22. The taxpayer can select among the old and the new tax regime, and under the new tax regime, the taxpayer may pay taxes on lower rates for significant deductions and exemptions.

• Tax payment or claim refund

Compute the total tax payable in case the tax deducted on income is lower than the tax liability. The excess tax liability over TDS should be paid to the government. In case the TDS deducted is more than the actual tax liability, then you can claim the refund for the excess paid while filing ITR.

• File ITR

Finally, you can file your ITR online without Form 16 once the steps mentioned above is finished.

Conclusion for Filing ITR online without Form 16

Hence by following the procedure mentioned above, one can file ITR online without Form 16. Please note that you should calculate tax and file ITR irrespective of whether your employer has deducted any tax or not or even if he hasn’t issued a Form 16.

Read our article:Demystifying Income Tax Form 16 for Salaried Person