The new Income Tax Act, 2025, which comes into effect from April 1, 2026, introduces a statutory limit of two years from the end of the relevant financial year for filing TDS/TCS correction statements.
A one-time transition deadline is in place with March 31, 2026 being final date for submitting correction statements for the following periods:
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FY 2018-19: Quarter 4.
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FY 2019-20 to FY 2022-23: All quarters.
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FY 2023-24: Quarters 1 to 3.
After this date, the TRACES system will not accept these correction statements as they will be considered time-barred. Failing to correct errors (like wrong PAN or mismatched amounts) within the deadline can result in the deductee losing the ability to claim tax credits in their Form 26AS/AIS. It can also lead to the Income Tax Department issuing demands to the deductor or deductee, potentially incurring additional tax, interest, and penalties.
From Financial Year 2024-25 onwards, the deadline for filing a correction statement is TWO YEARS from the end of the financial year, meaning the last date for FY 2024-25 is March 31, 2027. Deductors and taxpayers should review their TDS records on TRACES portal and file necessary corrections for financial years upto FY 23-24 mentioned above before March 31, 2026.
CS Sharad Bhargava