As the financial year 2025-26 begins, taxpayers have started preparing to file their income tax returns. On April 30, the Central Board of Direct Taxes (CBDT) released ITR Form 1 and Form 4.
The remaining forms are also expected to be issued soon. This year, the new ITR forms include major updates.
Salaried individuals are now also waiting for the updated Form 16, which will come with important changes.
What is Form 16?
Form 16 is a key document for salaried individuals. Employers issue it to employees, and it includes details of their total annual income and the tax deducted at source (TDS).
This form serves as proof that TDS was deducted from your salary and deposited with the Income Tax Department.
Who Needs Form 16?
If you switched jobs during the year, you need to collect Form 16 from each employer separately. The form has two sections – Part A and Part B.
Form 16 – Part A:
This section includes:
Name, address, PAN (Permanent Account Number), and TAN (Tax Deduction Account Number) of both the employee and employer
Quarterly details of TDS deducted and deposited
Part A helps verify your TDS records.
Form 16 – Part B:
This part shows:
Salary breakup and exemptions under Section 10 (like HRA)
Deductions under Sections like 80C and 80D (e.g., LIC, PPF, and health insurance)
Why is Form 16 Important?
It helps confirm your income and TDS while filing ITR
It acts as income proof when applying for loans
If extra TDS was deducted, it helps in getting a refund
It brings clarity about tax payments and deductions
What’s New in Form 16 This Year?
The Income Tax Department has updated the format of Form 16 to improve clarity on tax deductions, perquisites, and allowances beyond salary.
As reported by the Financial Express, some key changes include:
Tax-free allowances will now be shown more clearly
It will be easier to see how much salary was taxed and what deductions were claimed
These updates aim to reduce confusion during ITR filing and make the process simpler and more transparent.
