ISSUE OF FORM 16 BY PENSION PAYING BANKS

ISSUE OF FORM 16 BY PENSION PAYING BANKS

(Certificate issued under Sec.203 of the IT Act 1961 for the tax

Deducted at source on Salary/Pension)

Every pension paying Bank, whenever deducting Tax from the pensioner, must issue this TDS Certificate (Form 16A and Form 16B) by 31^st May of each year.  At the same time all pensioners must submit their PAN Number/Card to the bank and make sure that it is registered with the Bank.

Also it has become mandatory now to submit all tax savings deposits, certificates, other investments/receipts well in time to get included in the Form 16 to be issued by your bank.

The income and deduction claimed in your IT return for the AY 2017-18 must match with the Form 16A/16B issued by the Bank. At the same time the IT Department cross checks the taxes claimed as TDS or as paid by you in your return with the Form 26AS prepared by them.  The difference is any will lead to delay in processing and /or increased tax liability due to adjustment u/s 143(1) (a) and you may get notice from the IT Department.

Your IT return will not be processed until all the taxes deducted by the Bank, and all tax savings/investments are properly accounted in the Form 16 and the same is reflected in the Form 26AS.

As a matter of fact, even any Relief to be claimed under Sec.89(1) on account of any pension arrears received also to be worked out and submitted to the bank in advance for verification and including in the Form 16.

As on today many banks have not yet issued Form 16.  If issued it is not reflected in the Form 26 AS.  Whatever is deducted in the Pass book in not reflected in the Form 16 as well as Form 26 AS.  Because of this some tax payers could not file, some who have filed are facing Notice from IT department u/s 143(1).  The banks are silent on this issue.  The processing of IT returns are getting delayed.

A complaint to the Commissioner of Income Tax (TDS) HMT Bhawan, Bellary Road, Ganganagar, Bangalore 560032 has been lodged.  Awaiting reply.

This is the first time many tax payers facing this problem with the bank for Form 16.