Hello Team, Do the employer has to tally HRA provided by the employee before issuing Form 16 Payroll

Form 16 is issued once the employee submits the HRA proof to the company.

@Sai Venkata Vinay Chittuluru - Proof of HRA has to be submitted by the employee before the close of Financial Year - some companies initiate it in the month of April of the new Financial Year and allow the proof to be submitted by Feb of the Financial Year. Based on the proof received - it is the prerogative of the Organization to deduct appropriate tax, and submit it to the Income Tax portal accordingly in the quarterly returns. Therefore the appropriate deduction of tax as per the proof submitted by the employee, and its accuracy is the responsibility of the Employer. However if the proofs are bogus / forged - the liability lies with the employee. So it implies that the employer has to tally the Documentary Proof and the Tax Deduction that has happened under the HRA Component, that ultimately reflects in Form 16.

Does the payroll software do the automation or is it manual work? Thank you @Ashish Vyas

Its automatic

I concur with @Ashish Vyas inputs