It provides a validation that TDS has been deducted and deposited with the government authorities on behalf of the employee. It gives a detailed summary of the salary paid to the employee and the TDS deducted.

Form 16 contains the information you need to prepare and file your income tax return. Employers must issue it every year on or before 15 June of the next year, immediately after the financial year in which the tax is deducted.

Form 16 has two components – Part A and Part B.In case you lose your Form 16, you can request for a duplicate from your employer.

According to the regulations issued by the Finance Ministry of the Indian Government, every salaried individual who falls under the taxable bracket is eligible for the Form 16. If an employee does not fall within the tax brackets set, he/she will not need to have Tax Deducted at Source (TDS).

Hence, in these cases, the company is not under an obligation to provide the Form 16 to the employee. However, these days, as a good work practice, many organizations, even in these cases, issue this certificate to the employee as it contains a consolidated picture of the earnings of the individual and has other additional uses as well.