Form 130: New Salary TDS Certificate Under Income Tax Act, 2025

Form 130 is a tax certificate which is issued by the employer that mentions the details of the TDS deducted from an employee’s salary during each quarter. This also includes a detailed breakdown of salary, deductions, and other relevant information. Form 130 has replaced the previous Form 16 and is issued under Section 395 of the Income Tax Act 2025, read with Rule 215 of the Income Tax Rules, 2026. 

Form 130 is applicable to the income earned during the tax year 2026-27 and will be relevant from the next ITR filing season. For the current filing season, which relates to income earned during FY 2025-26, employers will continue to issue Form 16. Form 130 will not apply to this filing season. 

What is Form No. 130? 

1. Form No. 130 is a certificate for Tax Deducted at Source (TDS) issued once a year by an employer to a salaried employee or a pensioner. 
2. Form 130 mentions a detailed summary of tax deducted, salary earned and deposited, followed by the applicable deductions. It acts as proof that tax has been deducted from the salary and deposited with the authority. 
3. This is also applicable to the interest which is earned by specified senior citizens mentioned under Section 402(39) of the Income Tax Act, 2025.
4. The certificate allows the deductee to claim credit for the TDS deducted and deposited on their behalf by the deductor. 

Which Form does Form 130 replace?

Form 16 is now replaced by Form 130, which is issued under Section 203 of the Income Tax Act, 1961, read with Rule 31 of the Income Tax Rules, 1962. 

As per the Income Tax Act, 2025, Form 130 is renumbered to Section 395(4)(b) and Rule 215(1) of the Income Tax Act. 

Structure of Form 130

Form 130 is divided into 3 parts, A, B, and C, as compared to 2 parts in Form 16.

Part A - Employer and Employee Details

Part B - Salary or Pension paid and TDS Deducted

Along with that, challan-wise TDS deposits are provided, thereby ensuring complete transparency. Details like

Part C - Annexures

Who must Issue Form 130 and is it Mandatory?

1. The employer or specified bank is responsible for tax deduction as per Section 392 or Section 393(1). Issuing Form 130 is compulsory once tax has been deducted and deposited. 
2. Without a quarterly TDS, Form 130 cannot be issued to deductees. 
3. Form 130 cannot be issued offline.

How to Correct Mistakes in Form 130?

If any correction is required, the employer must file a revised TDS statement in Form 138 within the given time period. Once. the revised TDS statement is processed, the employer can download and issue the updated Form to the employee. 

Form 130 vs Form 16 - Key Differences

Form 130 has additional disclosures, in a detailed manner, compared to Form 16. The following table presents differences between Form 16 and Form 130.