TDS Returns Under the New Act: The Renumbered Forms and What Stays the Same
The Income-tax Act, 2025 took effect on 1 April 2026 and renumbered almost every TDS form. Form 24Q is now Form 138, Form 16 is now Form 130, and the four property-related challan forms have been merged into one. The obligations are largely unchanged. The paperwork isn't.
Why it matters
TDS Errors Cost You Twice Over
A missed deduction is not only a liability of its own. It also disallows the expense in your own tax computation.
Expenses get disallowed
Failure to deduct or deposit TDS on a payment leads to 30% of that expense being disallowed in your business income.
The fee runs daily
Late filing costs ₹200 a day until the return is filed, capped at the TDS amount in that return.
Your payees suffer
Until you file, the credit doesn't appear in their tax statement, so they can't claim it. Employees feel this most at filing time.
It shows up in your audit
Clause 34 of the tax audit report sets out every TDS default, so it is visible whether or not anyone asks.
Old form, new form
From tax year 2026-27, the statements and certificates carry new numbers. The content and periodicity are broadly the same.
| Purpose | Old form | New form |
|---|---|---|
| Quarterly TDS statement, salaries | 24Q | 138 |
| Quarterly TDS statement, payments other than salary to residents | 26Q | 140 |
| Quarterly TDS statement, payments to non-residents | 27Q | 144 |
| Quarterly TCS statement | 27EQ | 143 |
| Salary TDS certificate | 16 | 130 |
| TDS certificate, other payments | 16A | 131 |
| TCS certificate | 27D | 133 |
| Employee declaration for claiming deductions | 12BB | 124 |
| Annual tax statement | 26AS | 168 |
FY 2025-26 statements and certificates continue on the old forms and old section numbers. The renumbered forms apply from tax year 2026-27 onwards. For a while you will be handling both, so label your working files by year to avoid mixing them up.
Deposit and filing dates
| Obligation | Due date |
|---|---|
| Deposit of TDS, April to February | 7th of the following month |
| Deposit of TDS for March | 30 April |
| Quarter 1 statement, April to June | 31 July |
| Quarter 2 statement, July to September | 31 October |
| Quarter 3 statement, October to December | 31 January |
| Quarter 4 statement, January to March | 31 May |
The TCS statement now follows the same quarterly calendar as TDS, with the first-quarter date moved to 31 July.
One form for property, rent and contract payments by individuals
The four challan-cum-statement forms used by individuals and HUFs, covering purchase of property, rent above the threshold, payments to contractors and professionals, and payments to non-residents for property, have been merged into a single Form 141. It is filed using PAN, without a TAN, within the prescribed period after the month in which the deduction was made.
A related change matters for anyone buying from a non-resident. From 1 October 2026, a resident individual or HUF buying property from an NRI no longer needs a TAN and can deposit the tax using PAN through this route. Companies, LLPs and firms still require a TAN and continue to file the quarterly statement. Our guide to NRI property sales covers that in detail.
Certificates you must issue
- Form 130, the salary certificate: issued annually to each employee, by 15 June following the financial year.
- Form 131, for other payments: issued quarterly, within 15 days of the due date for filing that quarter's statement.
- Form 133, for TCS: issued quarterly on the same basis.
- Download them from TRACES. Certificates must be generated from the portal, not prepared manually, and must carry the TRACES logo and a unique certificate number.
- Late issue costs ₹100 a day per certificate, capped at the amount of tax deducted.
Where TDS goes wrong
Wrong or missing PAN
Without a valid PAN, tax must be deducted at the higher of the applicable rate or 20%. Collect and verify PAN before the first payment, not at the year end.
Deducting on payment instead of credit
For most payments, TDS applies at credit to the account or payment, whichever is earlier. Year-end provisions are a common miss.
Wrong section applied
Contract work, professional fees, commission and rent all carry different rates and thresholds. Misclassification shows up in the payee's tax statement and in your audit report.
Thresholds tested per payment
Most limits apply to the aggregate for the year, not to each bill. Track cumulative payments per vendor.
Deducting on the GST component
Where GST is shown separately on the invoice, TDS is generally deducted on the value excluding GST.
Ignoring lower-deduction certificates
If a vendor gives you a certificate, apply the rate it specifies and quote it in the statement. Deducting at the full rate anyway creates a refund problem for them.
Interest, fees and penalties
| Default | Cost |
|---|---|
| Tax not deducted | Interest at 1% a month from the date it was deductible until it is deducted |
| Tax deducted but not deposited | Interest at 1.5% a month from the date of deduction until deposit |
| Statement filed late | ₹200 a day until filed, capped at the TDS in that statement |
| Statement not filed, or filed with incorrect particulars | Penalty of ₹10,000 to ₹1,00,000 |
| Certificate issued late | ₹100 a day per certificate, capped at the tax deducted |
| Business expense where TDS was not deducted or deposited | 30% of the expense disallowed in your own computation |
Check the TRACES default report after each quarter rather than waiting for a demand. Short deduction, short payment and late payment defaults are cheapest to correct in the same quarter, through a correction statement.
This guide is general information on Indian tax and corporate law as it stood on 11 September 2026, and is not advice for any particular case. Rules, due dates and forms change, and how they apply depends on your facts. Please confirm the current position before acting, or speak to a qualified professional.
Who this applies to
Who Has to Deduct TDS
More businesses fall into this than expect to.
Companies, firms and LLPs
Deduction applies from the first payment, regardless of turnover, on salaries, contracts, professional fees, rent, commission and interest.
Proprietors and HUFs under audit
Once your books were subject to tax audit in the preceding year, TDS obligations apply to your business payments too.
Individuals buying property or paying high rent
No TAN needed. Deduct and deposit through Form 141 using your PAN.
Anyone paying a non-resident
Payments abroad need careful rate determination under the treaty, and the certification process before remittance.
Frequently asked questions
Answers to Your TDS Questions
What has replaced Form 24Q and Form 26Q?
From tax year 2026-27, Form 24Q becomes Form 138 for salaries and Form 26Q becomes Form 140 for other payments to residents. Form 27Q becomes Form 144 for payments to non-residents and Form 27EQ becomes Form 143 for TCS. FY 2025-26 statements continue on the old forms.
What has replaced Form 16?
Form 130. It is still the annual salary certificate, still downloaded from TRACES, and still due by 15 June following the financial year. Form 16A becomes Form 131 and Form 12BB becomes Form 124.
When do I have to deposit TDS?
By the 7th of the following month for deductions made from April to February, and by 30 April for deductions made in March. Quarterly statements are due by 31 July, 31 October, 31 January and 31 May.
Do I need a TAN to deduct TDS on a property purchase?
Not as an individual or HUF. You deposit the tax using your PAN through Form 141, which now covers property purchases, rent above the threshold and certain contract and professional payments. From 1 October 2026 this also applies when buying from a non-resident, though companies, LLPs and firms still need a TAN.
What happens if I don't deduct TDS on a business expense?
Interest at 1% a month applies from the date the tax was deductible, and 30% of that expense is disallowed in your own income computation. The default is also reported in clause 34 of your tax audit report.
How do I correct a mistake in a TDS return I already filed?
File a correction statement through TRACES. Check the default report after each quarter rather than waiting for a demand, because short deduction, short payment and late payment defaults are much cheaper to fix in the same quarter.
Unsure Which Form Applies This Year? We'll Sort It Out.
Share your TAN and payment details, and we'll check your deductions, clear any defaults showing on TRACES and file the quarterly statements on time.
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