Form 130 vs Form 131: What's the Difference?#
When you receive income in India — whether it's a monthly salary, a consulting fee, or interest from a bank fixed deposit — the payer is often required by law to deduct a portion of that income as Tax Deducted at Source (TDS) and deposit it directly with the government on your behalf.
To prove that this tax was deducted and deposited against your PAN, the payer must issue you a formal TDS certificate. Under the Income Tax Act, 2025 and the Income-tax Rules, 2026, the two certificates familiar as Form 16 and Form 16A have been renamed Form 130 and Form 131 respectively, effective for Tax Year 2026-27 onward (i.e., TDS on income paid or credited from 1 April 2026). The underlying purpose is unchanged — only the form numbers and some of the section references have moved.
Transition note: For salary and non-salary payments relating to FY 2025-26 (up to 31 March 2026), deductors still issue the old Form 16 and Form 16A. Form 130 and Form 131 apply from Tax Year 2026-27 onward. You may see both names used interchangeably in practice during this transition — they refer to the same underlying certificate.
What is Form 130? (The Salary Certificate)#
Form 130 is issued exclusively for Salary Income — the direct successor to Form 16. If you are a salaried employee, this is the most critical document you need from your employer to file your Income Tax Return (ITR).
- Who issues it? Your employer.
- Under which provision? The salary TDS provision (Section 192 under the erstwhile 1961 Act) continues in substance under ITA 2025.
- Frequency of issue: Annually, by the due date prescribed for the financial year immediately following the year in which the tax was deducted (June 15th under the previous regime; confirm the current-year due date with your CA as procedural dates settle post-transition).
The Structure of Form 130#
Like its predecessor Form 16, Form 130 is divided into two distinct parts:
- Part A: A summary of the tax collected and deposited by the employer — the employer's TAN and PAN, your PAN, and a quarter-wise breakdown of the TDS deposited. Generated centrally from the TRACES portal.
- Part B: A detailed breakdown of your salary components — gross salary, exempted allowances (like HRA or LTA), perquisites, and the deductions you claimed under Chapter VI-A equivalents (life insurance, health insurance, and similar).
What is Form 131? (The Non-Salary Certificate)#
Form 131 is issued for TDS deducted on income other than salary — the direct successor to Form 16A. This covers a wide spectrum of payments made to freelancers, professionals, contractors, and investors, now consolidated under Section 393 of the Income Tax Act, 2025 (which merged over 40 separate non-salary TDS provisions, including what were previously Sections 194J, 194C, 194A, 194H, and others, into a single section).
- Who issues it? Any entity (a company, a bank, a client) that deducts TDS on a non-salary payment made to you.
- Under which provision? Section 393, covering professional fees, contractor payments, interest, commission, rent, and similar non-salary payments.
- Frequency of issue: Quarterly. Unlike Form 130 which is annual, payers must issue Form 131 within 15 days from the due date of filing that quarter's TDS return.
Typical Scenarios for Form 131#
- Freelancers and Consultants: If you consult for a company and raise an invoice for ₹50,000, the company will likely deduct 10% TDS (₹5,000) under Section 393. They will pay you ₹45,000 and issue a Form 131 as proof of the ₹5,000 deposited. See our TDS on commission and brokerage guide for the specific rate and threshold when the payment is commission rather than a fee.
- Investors: If you earn significant interest from a bank Fixed Deposit, the bank will deduct TDS under Section 393 and issue you a Form 131.
Summary Comparison#
| Feature | Form 130 (formerly Form 16) | Form 131 (formerly Form 16A) |
|---|---|---|
| Type of Income | Exclusively for Salary Income. | All income other than salary (professional fees, interest, rent, commission). |
| Issued By | Employer only. | Banks, clients, tenants, or any entity deducting TDS. |
| Frequency of Issue | Annually. | Quarterly. |
| Applicable Provision | Salary TDS provision. | Section 393 (consolidated non-salary TDS provisions). |
| Components | Part A (TDS summary) and Part B (Salary breakdown). | A single consolidated statement showing income paid and tax deducted. |
| Applies from | Tax Year 2026-27 onward (Form 16 applies to FY 2025-26 and earlier). | Tax Year 2026-27 onward (Form 16A applies to FY 2025-26 and earlier). |
The Ultimate Verification: Form 26AS & AIS#
Regardless of whether you receive a Form 130 or a Form 131 (or the legacy Form 16/16A for an earlier year), it is your responsibility to verify that the tax deducted by the payer actually reached the government.
You should cross-check the TDS amounts mentioned on these certificates with your Form 26AS and the Annual Information Statement (AIS), which can be downloaded from the Income Tax e-filing portal. If a client issues you a Form 131 but the TDS does not reflect in your Form 26AS, you cannot claim credit for that tax, and you must follow up with the client to rectify their TDS return filing.