Tax Exemption – Daily Pioneer https://dailypioneer.in Dose of News Tue, 31 Dec 2024 05:52:36 +0000 en-US hourly 1 https://wordpress.org/?v=6.7.1 https://dailypioneer.in/wp-content/uploads/2023/04/cropped-DP-32x32.jpg Tax Exemption – Daily Pioneer https://dailypioneer.in 32 32 Decoding Form 16: TAN, PAN, Salary Breakups, and Tax Exemptions https://dailypioneer.in/decoding-form-16-tan-pan-salary-breakups-and-tax-exemptions/ Tue, 31 Dec 2024 05:52:36 +0000 https://dailypioneer.in/?p=6375 Income Tax Return: If you are employed by a company, you might already be familiar with Form 16. Issued by employers, this document is essential for salaried individuals as it contains vital information about their income and taxes. Companies typically issue Form 16 on or before June 15 of the assessment year. If you have worked with multiple employers during a financial year, you must obtain a separate Form 16 from each employer.

The Importance of Form-16

Form 16 serves as definitive proof of income and taxes paid during the year. This document is crucial for filing income tax returns and acts as income proof when applying for loans or credit. It also helps verify if the taxes paid align with your earnings, ensuring accurate filings.

What Information is Recorded in Parts A and B of Form-16?

Part A: Basic Employer and Tax Details

Part A includes key employer-employee details and tax payment information, such as:

  • TAN (Tax Deduction and Collection Account Number) of the employer
  • PAN of both the employer and employee
  • Address of the employer
  • Employment period
  • Assessment year
  • A summary of TDS (Tax Deducted at Source) deposited to the government

Part B: Detailed Salary Breakup and Tax Exemptions

Part B provides a comprehensive breakdown of the employee’s salary and applicable deductions, including:

  • Basic salary, house rent allowance, provident fund contributions, and professional tax
  • Tax exemptions, such as HRA (House Rent Allowance) and medical allowance
  • Deductions claimed under Chapter VI-A of the Income Tax Act, 1961 (e.g., Section 80C investments)
  • Tax liability, taxes paid, and refund details

Why Employers Must Issue Form-16

As per the Income Tax Act, 1961, employers are required to issue Form 16 to employees earning over ₹2.5 lakh annually. Non-compliance can result in a penalty of ₹100 per day under Section 272 of the Act.

How to Download Form-16

To obtain your Form 16:

  1. Visit www.tdscpc.gov.in.
  2. Log in using your user ID, password, PAN, and captcha.
  3. Navigate to the “Downloads” section and select “Form 16.”
  4. Choose the financial year and enter your PAN details to download the form.

By understanding Form 16 and its components, you can ensure compliance with tax regulations and accurately report your income while availing yourself of eligible exemptions.

]]> How Startups Obtain DPIIT Recognition: 5 Conditions and Benefits https://dailypioneer.in/how-startups-obtain-dpiit-recognition-5-conditions-and-benefits/ Sun, 26 Nov 2023 12:35:07 +0000 https://dailypioneer.in/?p=3822 If you’re contemplating starting a startup or have already initiated one, being a part of Startup India might have crossed your mind. However, obtaining DPIIT recognition is essential for this. Under this, registering your startup with the Department for Promotion of Industry and Internal Trade (DPIIT) becomes necessary. It’s noteworthy that not every startup can be registered under DPIIT. There are certain criteria that a startup must fulfill to get registered.

Know the Eligibility Criteria

To register your startup under DPIIT, it’s imperative that your business aligns with the criteria of being a “startup” under Startup India.

  1. Company’s Age

    For a business to be considered a startup under Startup India, its age should not exceed 10 years.

  2. Type of Company

    Only Private Limited Companies, Registered Partnership Firms, or Limited Liability Partnerships qualify for registration under Startup India.

  3. Annual Turnover

    A startup’s business turnover should not exceed Rs. 100 crore in any financial year.

  4. Original Entity

    One of the eligibility criteria for availing benefits under Startup India is that your business should be entirely original, not merely a part detached from an existing business.

  5. Innovative and Scalable

    Your business should be innovative, either in product/service development or in enhancing existing offerings. Additionally, it should have the potential for rapid scalability, generating substantial wealth and employment.

Benefits of DPIIT Recognition

The foremost benefit for startups registered under DPIIT through Startup India is a tax exemption for the initial three consecutive years within their first ten years. Additionally, such startups receive exemptions from numerous formalities and regulations, making their business operations smoother. Consequently, the desire to be registered under this scheme is high among startups. As per the Startup India website, approximately 1.15 lakh startups are registered under DPIIT currently.

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