Navigating your taxes can feel like a maze, but for salaried employees, Form 16 is your trusty map. This crucial document lays out your total salary, any TDS (Tax Deducted at Source), and how your tax was calculated.
Key Updates for Your FY 2024-25 ITR Filing (AY 2025-26)
The Income Tax Return (ITR) filing season for FY 2024-25 has officially kicked off, with Forms 1 to 4 now available. However, if you’re a salaried individual, you’ll need to hold tight until June 15, 2025, as that’s the deadline for employers to issue your Form 16.
This year, you get a bit of extra breathing room! The Income Tax Department has extended the ITR filing deadline to September 15, 2025, giving you more time to get your financial ducks in a row.
What’s New in Form 16 for FY 2024-25?
For the current financial year, there are some notable changes in Form 16, particularly if you’ve opted for the new tax regime. Here’s what salaried taxpayers should be aware of:
- Higher Standard Deduction (New Tax Regime): If you’ve chosen the new tax regime, the standard deduction for salaried individuals has jumped from ₹50,000 to ₹75,000. This increased deduction will be reflected in your Form 16. Just remember, if you switch back to the old regime when filing your ITR, the standard deduction reverts to ₹50,000.
- More Comprehensive TDS/TCS Details: Form 16 will now include details of TDS from other income sources (like interest from fixed deposits or dividends) and TCS (Tax Collected at Source) on specific expenditures (such as foreign travel). This applies if you’ve submitted Form 12BBA to your employer. This change allows employers to factor in these amounts, potentially reducing the TDS on your salary.
- Increased NPS Deduction for Employer Contributions (New Tax Regime): For those under the new tax regime, the deduction under Section 80CCD (2) for your employer’s contribution to your National Pension System (NPS) account has been increased to up to 14% of your basic salary. This higher deduction will appear in your Form 16 if you’re in the new tax regime. If you switch to the old regime during ITR filing, this deduction will be capped at 10% of your basic salary.
Don’t Forget These Important Steps!
- Verify Your Form 16: Once you receive your Form 16, make sure to cross-check all the details with your Form 26AS and Annual Information Statement (AIS). This helps catch any discrepancies early.
- Old vs. New Tax Regime: While the new tax regime is now the default, you still have the option to choose the old tax regime. Your Form 16 will reflect the regime you selected for TDS purposes. If you change your mind when filing your ITR, be sure to understand the impact on your deductions and tax liability.
- Enhanced ITR Disclosures: The ITR forms for FY 2024-25 now require more detailed information for various deductions under the old tax regime (e.g., House Rent Allowance, Section 80C, 80D). Even if your Form 16 is accurate, keep supporting documents handy for these claims.
By staying informed about these changes, you’ll be well-prepared for a smooth and accurate ITR filing experience for FY 2024-25!