A tenant paying rent above a certain threshold has always carried one extra responsibility beyond just paying the landlord on time. They had to deduct tax at source, deposit it with the government, and hand over a certificate proving it. That certificate used to be Form 16C. Since 1st April 2026, under the Income Tax Act, 2025, it is known as Form 132.

What Form 132 Actually Replaces

Form 132 isn’t a straight swap for Form 16C alone. It’s a consolidated certificate issued under Section 395(4) of the Income Tax Act, 2025, merging four older certificates into one, Form 16B for property transactions, Form 16C for rent, Form 16D for contractor and professional payments, and Form 16E for virtual digital asset transfers. A tenant issuing this certificate now uses the same form number a property buyer or a crypto trader would use, just for a different schedule of the corresponding filing.

For rent, the certificate ties back to Schedule A of Form 141, the challan-cum-statement that also replaced the older Form 26QC. The tenant deducts TDS, files Form 141 under Schedule A, and once that filing is processed, Form 132 gets generated to hand over to the landlord.

Who Needs to Issue It and When

The obligation applies to individuals and HUFs not liable to a tax audit, paying monthly rent above Rs 50,000 to a resident landlord. Two things are worth flagging here, since they haven’t changed even though the paperwork has:

• The TDS rate on this rent is 2 percent, a figure that came down from 5 percent back in October 2024, and it carries forward unchanged into the new Act.
• If the landlord doesn’t share their PAN, the deduction rate jumps to 20 percent instead.

Once TDS is deducted and deposited through Form 141, Form 132 must be issued within 15 days from the due date of that filing. This certificate can only be generated through the TRACES portal, so a document handed over outside that system isn’t considered valid proof.

What This Means in Practice

A tenant paying Rs 60,000 a month in rent still deducts 2 percent of the annual rent, deposits it through Form 141, and then generates Form 132 to give the landlord. The landlord uses this certificate to claim credit for the tax already deducted when filing their own return. If anything on the certificate needs correcting, the tenant has to file a revised statement first, and only then can an updated Form 132 be generated, there’s no separate correction process for the certificate on its own.

Missing the deadline to issue this certificate still carries a penalty, Rs 200 for every day of delay under the provision that replaced the older Section 234E framework. This makes timely filing just as important now as it was under the old system, even though the form name has changed.

Conclusion

Form 132 folds what used to be four separate certificates into one, which genuinely simplifies things for anyone dealing with property, rent, contractor payments, or crypto transactions across different years. For tenants specifically, the deduction rate, the threshold, and the underlying obligation remain exactly as before; only the certificate’s name and its route through Form 141 have shifted. Getting comfortable with this new pairing, one filing followed by one certificate, is really all that’s needed to stay compliant going forward.