Income Tax Alert: New Deadline for Correcting Mistakes in TDS/TCS; Otherwise, Notice Will Be Ready

The Income Tax Department has issued a clear warning for taxpayers and deductors. If there are errors in your TDS (Tax Deducted at Source) or TCS (Tax Collected at Source) filings, you have one last chance to fix them before March 31, 2026. If you miss this date, your mistakes could lead to tax notices.

Why This Deadline Matters

From Q4 of FY 2018 to Q3 of FY 2023, many deductors and taxpayers may have filed incorrect TDS/TCS statements, including wrong PAN details, mismatched challan information, or incorrect deduction amounts.

So far, the Income Tax Act allowed corrections within a 6-year window. But under the new Income Tax Act 2025, this period has been cut to just 2 years.

This means after March 31, 2026, you won’t be able to revise old statements from that time. Any unresolved mismatches may:

• Deny you credit for TDS/TCS already paid.
• Lead to duplicate taxation on the same income.
• Trigger automated notices from CPC.

What Changed?

• Old Rule: 6 years allowed for corrections.
• New Rule (from April 1, 2026): Only 2 years from the end of the relevant financial year.
• Final Window: For past returns (FY 2018 Q4 to FY 2023 Q3), corrections must be filed by March 31, 2026.

What You Should Do Now

• Review Old Filings – Check your TDS/TCS returns for FY 2018 (Q4) through FY 2023 (Q3).
• Match with Form 26AS / AIS – Make sure the deducted/collected amounts match what appears in these statements.
• Correct Errors on TRACES – File correction statements for wrong PAN, challan mismatches, or excess/short deductions.
• Communicate – If you are a deductor (employer, bank, etc.), inform deductees to verify credits and raise questions.
• Keep Proof – Maintain acknowledgements of correction filings.

Risks If Ignored

• Loss of TDS/TCS credit – Taxpayers may not receive credit for taxes already paid.
• Duplicate Tax Payments – You may end up paying tax again on the same income.
• Automatic Notices – CPC will likely generate tax demand notices for mismatches.
• Refund Delays – Pending corrections can block or delay refunds.

Quick Reference Table

Final Word

The message is clear: act before March 31, 2026. Don’t wait for a tax notice to remind you. Review your TDS/TCS statements, fix any mistakes, and stay compliant.

A little effort today can save you from unwanted tax demands tomorrow.

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