How to upgrade my iPadOS 12.5 to iPadOS 16?

You have an iPad mini2.

The first generation iPad Air, iPad mini2 and mini3 can only be updated to iOS 12.5.7.

Apple ended major update support for these models of iPad in September 2019 - although they have since received occasional “point” security updates, the most recent being released January 2023. These devices cannot be updated to iPadOS 13 (or any later major versions of iPadOS) as the internal hardware does not meet the minimum technical requirements (CPU capabilities and available RAM) for newer versions of iOS/iPadOS.

While many App titles remain compatible with your iPad, if you want or need to access to Apps requiring more recent versions of iOS than your iPad is capable, you’ll need to consider replacement of your iPad with a newer or current model that supports iPadOS 16/17.

For information, here is a list of the highest version of iOS supported by the older models of iPad (for simplicity - “generations” are shortened to a number) that are restricted in their ability to be updated:

32-bit devices (obsolete)

iPad1 - iOS 5.1.1

iPad2, iPad3 and iPad mini1 - iOS 9.3.5 (WiFi Only models), iOS 9.3.6 (WiFi & Cellular)

iPad4 - iOS 10.3.3 (WiFi Only), iOS 10.3.4 (WiFi & Cellular)

64-bit devices

iPad Air1*, iPad mini2 and iPad mini3* - iOS 12.5.7

iPad Air2, iPad mini4 - iPadOS 15.8.2

iPad5, iPad Pro (9.7"/12.9" first generation) - iPadOS 16.7.8

(*) obsolete

Newer models are all able to be updated to the current version - iPadOS 17.5.1

• iPad Pro 13" (M4)
• iPad Pro 12.9" (2nd generation and later)
• iPad Pro 11" (1st generation and later + M4)
• iPad Pro 10.5"
• iPad Air (3rd generation and later + M2)
• iPad (6th generation and later)
• iPad mini (5th generation and later)

this is the way Update your iPhone or iPad - Apple Support

but only ipad mini 5g and 6g support ios16

iPad Mini - Wikipedia