FY 2026-27 · Income-tax Act, 2025

Form 16 is now Form 130: Why You Will Receive Two Different TDS Certificates This Year

The transition year is here. In 2026, many salaried professionals are confused because they are receiving both Form 16 and Form 130. We explain the difference, why this is happening, and which one to use for your ITR.

FY 2025-26 → Form 16

FY 2026-27 → Form 130

Quick Answer

The Income-tax Act, 2025 replaced the old 1961 Act starting April 1, 2026. Because tax filing happens in arrears (you file in 2026 for income earned in 2025), you will deal with two forms during the transition period. Form 16 is for the salary you earned up to March 31, 2026. Form 130 is for the salary you earn from April 1, 2026 onwards.

The Transition Confusion Explained

Tax seasons can be confusing because we deal with "Financial Years" (FY) and "Assessment Years" (AY). Let's clear up the timeline for the switch from Form 16 to Form 130.

Salary Earned During	Governing Law	TDS Certificate Issued (June)	ITR Filed In (July)
April 2025 – March 2026 (FY 25-26)	Old Act (1961)	Form 16 (Issued June 2026)	File ITR in July 2026
April 2026 – March 2027 (FY 26-27)	New Act (2025)	Form 130 (Issued June 2027)	File ITR in July 2027

Scenario 1: You switched jobs in mid-2026

If you worked at Company A from January to March 2026, and Company B from April to December 2026, you will receive:

A Form 16 from Company A (for FY 25-26, old Act).
A Form 130 from Company B (for FY 26-27, new Act) the following year.

What is Form 130?

Form 130 is the new official TDS certificate issued by employers under Section 392 of the Income-tax Act, 2025. It proves that your employer deducted tax from your salary and deposited it with the government.

The New 3-Part Structure of Form 130

Unlike the old 2-part Form 16, the new Form 130 is structured for better clarity:

Part A (Identification): Contains Employer TAN, your PAN, and basic details.
Part B (Summary): A high-level summary of total salary paid and total TDS deducted over the year.
Part C (Detailed Annexures): The granular breakdown. It shows your exact salary components, claimed exemptions (like HRA under Sec 134), claimed deductions (like Sec 123 for investments), and the step-by-step tax computation.

Why the 3-Part Structure is Better

Under the old Form 16, Part B was often cluttered, mixing summary data with detailed calculations. Form 130's Part C isolates the complex calculations, making it much easier for you to verify if your employer correctly applied your declared investments.

✓ Action Item: Match with Form 168

Whether you receive a Form 16 or a Form 130, you must always cross-verify the TDS amount against your Annual Information Statement on the Income Tax portal. The old Form 26AS is now Form 168.

How to Use Form 130 for ITR Filing

When filing your Income Tax Return (ITR) for FY 2026-27 and beyond, you will use Form 130 exactly as you used Form 16:

Copy the gross salary figure from Part B.
Verify the exemptions and deductions in Part C against your own records.
Enter the TDS deducted figure into the 'Taxes Paid' section of your ITR.

Estimate Your Form 130 Tax Now

Don't wait until the end of the year to see your Form 130. Use our Income Tax Calculator to project your tax liability for FY 2026-27 under the new Act.

Calculate My Tax →

Frequently Asked Questions

Will I get a Form 16 in 2027?

No. For salary earned during FY 2026-27 (April 2026 onwards), employers will issue the new Form 130 in June 2027. Form 16 is obsolete for income earned after March 31, 2026.

Is Form 130 generated from TRACES?

Yes. Just like Form 16, your employer will download Part A and Part B of Form 130 directly from the TRACES portal after filing their quarterly TDS returns (Form 138). Part C is usually generated by the employer's payroll software.

What if my Form 130 has mistakes?

If you spot errors in your Form 130 (e.g., missing 80C/Sec 123 deductions), contact your HR or payroll department immediately. They will need to file a revised TDS return to correct the certificate.