Form 16 and TDS Explained: What It Is, How to Download, and Disputing a TDS Mismatch (2026)

Explainer · Income Tax & TDS

Updated for 2026 · Claw Editorial

Form 16 is the TDS certificate an employer issues to an employee. It shows the salary paid and the tax deducted during the year, and you use it to file your income tax return. Your employer generates it from the TRACES portal and hands it to you. You do not download it yourself from the income tax site. This guide explains Part A and Part B, how Form 16 differs from Form 16A, Form 26AS and AIS, and what to do if the TDS in your records does not match, or your employer deducted tax but never deposited it.

01What Form 16 is

When an employer pays you a salary, it must cut tax from that salary before paying you. This is called TDS, or tax deducted at source. The employer then deposits that tax with the government on your behalf.

Form 16 is the proof. It is a certificate, issued under section 203 of the Income-tax Act, that tells you and the tax department how much salary you were paid and how much tax was deducted and deposited in the year.

Employers must give Form 16 to employees by 15 June after the financial year ends. For salary earned in FY 2025-26, that means by 15 June 2026.

02Part A and Part B of Form 16

Form 16 has two parts. You need both.

Part A: the tax record

Part A shows the employer’s name, address, PAN and TAN, your PAN, the period of employment, and a quarter-wise summary of tax deducted and deposited. It also carries the challan details, so you can see that the money reached the government. Part A is generated from the TRACES portal, so it matches what the employer filed in its TDS returns.

Part B: the salary and tax working

Part B is an annexure. It breaks down your gross salary, allowances, exemptions, deductions under Chapter VI-A, the tax on your total income, and the final tax deducted. It is the part that shows how your tax was worked out.

Check Part B carefully. If you changed tax regime, or you have income from another job, house property or investments, your own return may need figures that Form 16 does not show.

03How to get your Form 16

This is the point many people get wrong. Form 16 is not something you pull from the income tax e-filing site. Your employer downloads it and gives it to you.

1. The employer files its quarterly TDS returns (Form 24Q for salary).
2. The employer logs in to the TRACES portal and requests Form 16 for the year. TRACES generates Part A. Part B is prepared with the salary details.
3. The employer signs it, usually with a digital signature, and sends it to you.

If you have not received it, ask your HR or accounts team first. Employers who do not issue Form 16 on time can face a late fee for each day of delay under the Act.

If you have left the company, write to the employer in writing and keep a copy. Meanwhile, you can still file your return using your salary slips and Form 26AS or the AIS. Form 16 makes filing easier, but you can still file without it.

04Form 16 vs Form 16A vs Form 26AS vs AIS

These four are often mixed up. They answer different questions.

The key idea: Form 16 is what your employer says it deducted. Form 26AS and AIS are what the government says it received. For your credit, the second one is what the system uses, so always compare the two.

05Using Form 16 to file your ITR

Once you have Form 16, filing is mostly matching and checking.

• Compare first: match the TDS in Part A with the TDS in Form 26AS and AIS on the e-filing site.
• Enter salary and deductions: copy gross salary, exemptions and deductions from Part B, then add income that Form 16 does not cover.
• Claim TDS credit: the TDS shown in your return should match what appears against your PAN.
• Pay any balance tax: if your total tax is higher than TDS, pay the difference before you file.
• Verify the return: e-verify it after filing so it counts as filed.

For the full filing steps, due dates and which ITR form to pick, read our guide on how to file an income tax return in India.

06TDS on rent: sections 194I and 194-IB

Rent is the most common non-salary payment that carries TDS, and it is where people search for the “rent TDS section”. There are two sections, and which one applies depends on who is paying the rent. The tax on rent that the tenant deducts is reported to the landlord on Form 16A or Form 16C, not on Form 16.

Section 194I: rent paid by businesses and others

If you run a business or profession, or you are a company or a firm, and you pay rent above the yearly threshold, you must deduct TDS under section 194I. The rate is 10% for land, building or furniture, and 2% for plant and machinery. You deposit it with your TAN and show it in your quarterly TDS return, and the landlord gets Form 16A.

Section 194-IB: rent paid by individuals and HUF

A salaried person or any individual or HUF who is not under tax audit does not need a TAN. But if you pay rent of more than Rs 50,000 a month, you must deduct TDS under section 194-IB. You deduct it once, in the last month of the tenancy or of the financial year, whichever comes first. You pay it online with Form 26QC and then download Form 16C from TRACES for your landlord.

Which one applies to you?

• A salaried tenant paying a flat rent above Rs 50,000 a month: section 194-IB.
• A company, firm or audited business paying office or shop rent above the yearly limit: section 194I.
• A landlord whose tenant has deducted TDS: check that it shows in Form 26AS and AIS, and claim it in your return.

Rent TDS goes wrong in the same ways as salary TDS: a wrong PAN, a missed Form 26QC, or tax deducted but never deposited. The steps in the next two sections on mismatch and non-deposit apply here as well. This is general information, not tax advice.

07What to do if there is a TDS mismatch

A mismatch means the TDS in your Form 16 is different from the TDS in Form 26AS or AIS. It is common, and many cases are small clerical errors. Work through them in order.

Step 1: find where the gap is

Check the PAN, the quarter, and the amount. A wrong PAN in the employer’s TDS return is the most common reason credit does not show up. Another is a delay, because TDS shows in Form 26AS only after the employer files its quarterly return.

Step 2: ask the employer to correct the return

Only the person who deducted the tax can fix it. Ask your employer to file a correction statement for the TDS return and share the new Form 16. Give them your PAN, the quarter and the amount in question.

Step 3: use the portal if the employer does not help

You can report the issue to the department through the e-filing portal, and file a grievance on it. Keep the screenshots and your salary slips.

Step 4: file correctly, and keep proof

Do not claim more TDS than your records support. Claim what your Form 16, salary slips and bank statements prove, and keep those documents safe in case of a notice.

08What if your employer deducted TDS but did not deposit it

This is the harder case. Your salary slip shows tax cut, your Form 16 may even show it, but Form 26AS shows nothing. The employer kept the money.

The law is on your side. Section 205 of the Income-tax Act says that where tax is deductible at source, you cannot be asked to pay that tax again to the extent it was deducted from your income. The default is the deductor’s, and the department’s main remedy is against the deductor.

In practice, though, the department may still deny the credit or raise a demand when 26AS does not show the tax. Several Income Tax Appellate Tribunal (ITAT) benches have held that an employee should not lose credit for TDS the employer failed to deposit, and that salary slips and bank statements can be accepted as proof.

What to do:

• Write to the employer, asking it to deposit the tax and file the TDS return, with a copy to its senior management.
• Collect salary slips, Form 16, bank statements showing net salary, and the appointment letter.
• File your return claiming the TDS shown in your documents, and respond to any intimation or notice in time.
• Use the rectification, grievance or reply routes on the e-filing portal if a demand is raised.

09When it becomes a legal dispute

Most TDS problems end with a corrected return or a rectification order. Some do not. If the demand stays, the path usually runs as follows.

1. Rectification or reply to the Assessing Officer or the processing centre.
2. Appeal to the Commissioner of Income Tax (Appeals).
3. Appeal to the ITAT, the first level that is a tribunal of fact.
4. High Court, on a substantial question of law.

At each stage, hearing dates move, orders come out, and short deadlines apply for the next step. Anyone handling several such matters, such as a CA firm or a lawyer, needs to know the next date for each. That is a case tracking job, not a tax calculation job.

This guide does not give tax or legal advice. For a real demand, speak to a chartered accountant or an advocate who handles income tax matters. Related topics, such as service benefits that also carry tax effects, are covered in our explainer on gratuity calculation and claim.

10Where Claw fits

Claw does not issue Form 16, help you download it, or file your return. That is done through your employer, TRACES and the e-filing portal. Claw is useful only if your TDS problem turns into a dispute that goes through appeals.

Claw is an all-in-one legaltech platform for Indian advocates, law firms, and corporate legal teams, combining AI-based case search, an AI legal assistant (Legal GPT), case management, and compliance automation across all Indian courts and tribunals.

For tax litigation, that means a few things. Case search helps you find judgments and tribunal reasoning on points such as credit for TDS not deposited. Case management tracks your matter through the ITAT and the High Court, with hearing dates, cause lists and WhatsApp and email alerts. Claw has a free plan for individual advocates, and paid plans for teams.

If your firm also manages an investment portfolio on the insurance side, our list of GI portfolio software in India is a separate topic.

11Sources and further reading

• Income Tax Department e-filing portal: incometax.gov.in
• TRACES (TDS Centralised Processing Cell): tdscpc.gov.in
• Income Tax Appellate Tribunal: itat.gov.in
• Claw: clawlaw.in

Last verified October 2026. Rules, section numbers and forms are changing with the new Act, so confirm details on the official site before you rely on them. This is general information, not tax or legal advice.

12Frequently asked questions