prpri New disclosure requirements in Form 16 & Quarterly TDS Return 24Q New disclosure requirements in Form 16 & Quarterly TDS Return 24Q

Central Board of Direct Taxes (‘CBDT’) has issued Notification No. 36/2019 dated 12th Apr’2019 (‘Notification’) seeking tax deductors (i.e. employers) to submit detailed break-up while furnishing Form No. 16 and Form No. 24Q.

Salient provisions introduced by said notification along with objective of the amendment are captured under –

A. Objective of the Amendment –

  • Earlier formats allowed tax deductors to furnish consolidated amounts for income of the employee, tax deductions and tax exemptions available to employees. These consolidated disclosures left some sort of ambiguity and thereby making difficult for the Income-tax department (‘Department’) to track down false deductions availed in Income-tax returns.
  • Thus, newly introduced formats intend to put a break on all such false practices and ensure availability of complete view of detailed break-up of Income, tax deductions, tax exemptions to tax department.
  • Newly introduced formats also intend to bring uniformity in disclosures across all tax deductors. This should help department to further digitise and smoothen process of processing Income-tax returns by enhanced system driven comparisons between Income-tax returns and Form-16s.

B. Applicability of The Notification –

As per Rule 1 of the Income-tax (3rd Amendment) Rules, 2019 introduced by said Notification, it is specified that Notification shall come into force on 12th May’2019.

Since, notification was issued on 12th Apr’19 and is coming into force w.e.f. 12th May’2019, it can be safely assumed that same shall be applicable for AY 2019-20 (i.e. FY 2018-19) as well.

This is due to the following reasons –

1. Tax deductors are required to submit details in relation to Form-16 only in the Quarter 4 TDS return (i.e. Jan’19-Mar’19 return); and

2. Such quarterly return is required to be submitted by 31st May’19.

C. The changes/ new requirements

New formats primarily require tax deductors to furnish following additional information-

1. Total amount of salary received from other employer(s)

2. Detailed break-up for exempt allowances –

a. Leave travel concession allowance u/s 10(5)

b. Death-cum-retirement gratuity u/s 10(10)

c. Commuted value of Pension u/s 10(10A)

d. Leave encashment u/s 10(10AA)

e. HRA

f. Any other allowance exempt u/s 10

3. Section-wise disclosure of deductions u/ Chapter VI-A (viz. Sec 80C, 80CCC, 80D,80E, 80G, 80TTA etc.)

4. Standard deduction as announced in Finance Act,2018.

5. Concurrent changes have been made in Format of TDS return (Annexure -II of Form 24Q) as well.

Disclaimer – Views expressed above are personal views of the Author and are not meant for any technical/ legal use. Please refer Government publications/ notifications/ Bare Act before taking any decision or taking any action in relation to the same.

Feedbacks for the above can be submitted to Author – Divesh Gupta (CA, CS, B.Com) at or at +91-9910041481.

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Qualification: CA in Job / Business
Company: Private Limited Company
Location: Bengaluru, Karnataka, IN
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One Comment

  1. deepak says:

    i received the below mail now what to do

    As per our records, it has been observed that you have entered the value of House rent allowance [section 10(13A)] as “Zero” for all the employees in the TDS statements for the FY 2018-19, 24Q, Q4 as per the format prescribed by “CBDTs Notification 36/2019” although the taxable income of the deductees are more than Rs.6,00,000.

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