Filing income tax returns will now be much easier. A new digital form will simplify the process.
Salaried people need Form 16 to file their returns, as it contains details like salary income, TDS, and deductions.
Now, employers will issue a digital Form 16 to their employees. Let’s understand this in detail.
Form 16 will now come directly from TRACES
Digital Form 16 is created directly from the TRACES portal, which is part of the Income Tax Department’s system. It is the online version of the usual Form 16.
Since TRACES is an official government portal, the information in this form—like salary, TDS,
and deductions—is fully accurate and trustworthy. Earlier, this data had to be verified manually with Form 26AS and AIS.
Upload the form, and your ITR will auto-fill
Salaried people can now file their ITR more easily. Just visit the Income Tax Department’s return filing website and select the right ITR form.
Once you upload your digital Form 16, all related details like income, TDS, and deductions will be filled in automatically.
Tax calculation will be accurate and fast
With the digital Form 16, tax calculation becomes quick and error-free. This will save a lot of time in filing returns.
It will also speed up the processing of returns and issuance of refunds. The usual last date for filing ITR is 31st July, though it can be extended.
For example, during the Covid period, the deadline was extended. If you file returns after the due date, you may have to pay a penalty and interest.
Safe and eco-friendly, thanks to password protection
Digital Form 16 is safe from misuse because it is password-protected. A standard format is used for setting the password, keeping your financial data secure.
It’s also better for the environment, as there’s no need to print the form. This helps reduce paper usage.
