The Income Tax Department has made a major change in the format of Form-16 to simplify the process of filing Income Tax Return (ITR) for the financial year 2024-25 (Assessment Year 2025-26)! The government wants people to avoid any confusion and reduce mistakes while filing taxes. That is why Form-16 has now been made even more detailed. If you are a salaried person, start preparing to file returns as soon as you get Form-16 in June! This new format will make filing taxes easier for you.

Now every information will be clear

Earlier Form-16 used to contain only basic information, but now it will show tax-free allowances, deductions, and the taxable part of salary separately. This means that you will know how much of your salary comes under the tax bracket and how much is tax-free. This change will help you understand your tax liability better.

Apart from this, some facilities provided by the company, such as free housing, will now be taxable. That is, if your employer gives you a house to live in for free, then you may have to pay tax on its value. These changes have come into effect from 20 February 2025 and will be valid for the financial year 2024-25. Now you have to look at your salary slip more carefully so that you can do your tax planning according to these new rules.

When will you get the new Form-16

Your company has to issue Form-16 by 15 June 2025. This is the reason why most people start filing tax returns in June itself. This time, getting a new and detailed format will make it even easier for you to file returns. Get Form-16 on time and start your tax filing process without any delay.

What will appear in the new Form-16

You will get the following important information in the new Form-16:

Every small and big part of the salary will be shown separately. This will make it easier for you to understand the various components of your income.

Complete information about tax-free allowances and tax facilities will be given. This will help you know which allowances you do not have to pay tax on.

There will be a complete list of deductions like Section 80C (PPF, LIC), 80D (Home Insurance), 80E (Education Loan). This will make it easier for you to claim your tax savings.

The company’s PAN and TAN numbers will also be present in the form. These numbers are important for the identification of your employer and tax related details.

Why is Form-16 so important

This form will be your biggest support while filing tax returns. It contains complete details of your income and tax deducted, which makes filing returns easier.

Banks also consider it as proof of your income when taking a loan. It shows your financial credibility.

If TDS has been deducted from your account, you can also claim a refund using this form. This helps you get back the excess tax deducted.

How to prepare

Gather your Form-16, bank statements, and investment proofs now. This will make it easier for you to file your returns, and you will not miss any important documents.

Go to the Income Tax website and check your Form 26AS (complete TDS details are available here). This will let you know how much tax your employer has deducted and whether it matches your Form-16 or not.

Update your bank account number and IFSC code on the portal so that you can get your refund quickly. By providing the correct bank details, your refund will come directly to your account without any delay.