Quarterly TDS and TCS Statements

A deposit on its own is anonymous money. It becomes a deductee’s tax credit only when the deductor files a quarterly statement that says whose tax it was, against which payment, and on which challan. A late statement carries a daily fee. A wrong one leaves deductees without their credit and produces defaults in the deductor’s name. From tax year 2026-27 the statements also have new form numbers, which this guide sets out alongside the old ones.

Which Act applies

The duty to file is in section 200(3) of the 1961 Act, with rules 31A (TDS) and 31AA (TCS) of the 1962 Rules, for deductions up to 31 March 2026. From 1 April 2026 it is in section 397(3)(b) of the 2025 Act and rule 219 of the Income-tax Rules, 2026. The quarter January to March 2026 is therefore the last one filed under the old law and the old forms. Protean’s note on the utilities states that the new form changes “shall be effective from FY 2026-27 onwards”.

The forms, old and new

Statement	1962 Rules	2026 Rules (rule 219)	Covers (2025 Act)
Salary	24Q	Form No. 138	Section 392 (other than 392(7)); section 393(1) [Table: Sl. No. 8(iii)], specified senior citizens
Non-salary, residents	26Q	Form No. 140	Sections 392(7), 393(1) (other than Sl. No. 8(iii)) and 393(3), for residents
Non-residents	27Q	Form No. 144	Sections 392(7), 393(2) and 393(3), for non-residents (non-company or foreign company) and residents but not ordinarily resident
TCS	27EQ	Form No. 143	Section 394(1)
VDA exchange paying instead of buyer	26QF	Form No. 142	Section 393(1) [Table: Sl. No. 8(vi)]
PAN-based challan-cum-statement	26QB/QC/QD/QE	Form No. 141	Section 393(1) [Table: Sl. Nos. 2(i), 3(i), 6(ii), 8(vi)]

Form No. 141 is a one-off filing made within 30 days with the payment. It is not a quarterly return, and the previous guide covers it. Under the incometaxindia.gov.in FAQ, Form No. 138 carries Annexure I every quarter, and Annexures II and III only in the fourth quarter. These annexures hold the employee-wise salary, exemption and deduction details from which Form No. 130 (formerly Form 16) is generated.

Due dates

Quarter ending	TDS, both Acts (rule 31A / rule 219(4))	TCS, 1961 Act (rule 31AA)	TCS, 2025 Act (rule 219(4))
30 June	31 July	15 July	31 July
30 September	31 October	15 October	31 October
31 December	31 January	15 January	31 January
31 March	31 May following	15 May following	31 May following

The 2026 Rules have moved the TCS statement onto the same calendar as TDS, which is a fortnight later than rule 31AA allowed. The last 27EQ under the old rule, for January to March 2026, was due on 15 May 2026. The first Form No. 143, for April to June 2026, was due on 31 July 2026.

What to have ready

• Challan details for each deposit in the quarter: BSR code, date, challan serial number and amount. These come from the challan receipt or the e-Pay Tax payment history.
• Deductee-wise records from the books: PAN, amount paid or credited, date, section code, rate, and tax deducted.
• Non-deduction and lower-deduction flags: lower or nil deduction certificates under section 395 (number and validity), and declarations in Form No. 121 (the former 15G and 15H) with the unique identification number the payer allots to each. Rule 211(4) requires the declarations to be reported “regardless of the fact that no tax has been deducted in the said quarter”.
• Interest and fee already paid for late deduction, late payment or late filing. Section 398(3)(b) and section 427(2)(b) require these to be paid before the statement is delivered.
• For Form No. 138 in the fourth quarter, each employee’s salary break-up, the regime opted, and the exemptions and deductions allowed.

Preparing and filing: the RPU and the FVU

The incometaxindia.gov.in page on online filing of TDS returns sets out the route. The statement is prepared in the notified file format using Protean’s Return Preparation Utility (RPU), or any other software, and checked with Protean’s File Validation Utility (FVU). The FVU reports errors, which are fixed and the file revalidated. The resulting .fvu file is then either submitted at a TIN Facilitation Centre or uploaded on the e-filing portal, where the deductor’s organisation must be registered.

For the new forms, Protean’s note Key Features — RPU and FVU version 1.1 lists the changes in Forms 138, 140, 143 and 144:

• the form names change from 24Q, 26Q, 27Q and 27EQ;
• “Financial Year” becomes “Tax Year”;
• a contact number with country code is added for the deductor and the responsible person;
• the surcharge, education cess and penalty/others fields are removed from the challan details, and the interest and fee columns become “Total Interest” and “Total Fee”;
• the column for the lower or nil deduction certificate now refers to a certificate under section 395(1) (or 395(1)/395(2) in Form No. 144) instead of section 197;
• the column numbering changes throughout.

Statements for quarters up to January to March 2026 still use the 1961-format utilities.

Signing and verification. Rule 31A(3) of the 1962 Rules required electronic filing, under digital signature or with electronic verification, by government offices, companies, persons liable to tax audit, and anyone with twenty or more deductee records in a quarter. The FAQs on Forms 138, 140, 143 and 144 state that under the 2026 Rules all such statements “must be furnished electronically in the prescribed format”. The FAQ says that a deductor receives an acknowledgement receipt number on successful submission.

Processing and the intimation

Statements are processed centrally under section 399 (formerly section 200A). Arithmetical errors and incorrect claims apparent from the statement are adjusted, and interest and the fee are computed. An intimation then shows the amount payable or refundable, and must issue within one year from the end of the tax year in which the statement is filed (section 399(2)). The next-but-one guide explains how to read the defaults this produces.

Late filing: the fee

Section 427(1), the counterpart of section 234E, charges Rs 200 for every day the failure continues. The fee is capped at the tax deductible or collectible and is paid before the statement is delivered (section 427(2)).

The fee is automatic. In Rajesh Kourani v Union of India (Gujarat High Court, 20 June 2017, SCA No. 302 of 2014), a proprietor of a garment business challenged a fee adjusted in a section 200A intimation for a period before 1 June 2015, the date from which section 200A expressly referred to the section 234E fee. He also argued that rule 31A unfairly gave Government deductors fifteen extra days. The Division Bench rejected both points. It held section 234E to be the charging provision and section 200A “a machinery provision”, so the fee could be levied even before the amendment. The petitioner had not pressed the constitutional challenge, given the Bombay High Court’s decision in Rashmikant Kundalia v Union of India [2015] 373 ITR 268 upholding section 234E. The Gujarat court expressly disagreed with the Karnataka High Court Division Bench in Fatheraj Singhvi v Union of India, which had treated the 2015 amendment as prospective, so the High Courts were divided on the pre-June 2015 question. The 2025 Act leaves no room for that dispute, because section 399(1)© itself directs the fee to be computed under section 427.

Late filing or wrong information: the penalties

• Section 461 (formerly section 271H): a penalty of Rs 10,000 to Rs 1,00,000 for failing to file in time or for “incorrect information in the said statement”. No penalty applies for delay if the tax, fee and interest were paid and the statement was filed “before the expiry of one month” from the due date (section 461(2)). The 1961 Act allowed one year until the Finance (No. 2) Act, 2024 cut it to one month from 1 April 2025.
• Section 465(2)(k): Rs 500 a day for failing to deliver the statement within the time in section 397(3)(b), capped at the tax deductible (section 465(3)©). Its 1961 counterpart, section 272A(2)(k), was switched off by a proviso for statements due on or after 1 July 2012, once section 234E and section 271H took over. Section 465 as printed in the 2025 Act carries no such proviso.
• Section 470 gives a reasonable-cause defence to both sections 461 and 465(2).

What can be changed after filing

A filed statement cannot be edited. The FAQs say a correction statement may be filed “once the previously submitted statement has been processed by CPC-TDS”. Under section 397(3)(f) a correction must be delivered “within two years from the end of the tax year in which such statement is required to be delivered”. The FAQ’s example is a third-quarter statement for tax year 2026-27, correctable up to 31 March 2029. The 1961 Act allowed six years. The details are in Correction Statements and TRACES Defaults.

Summary

1. Pick the form: 138 for salary, 140 for other payments to residents, 144 for non-residents, 143 for TCS. Use 24Q, 26Q, 27Q or 27EQ for quarters up to March 2026.
2. Reconcile challans, deductee records, certificates and Form No. 121 declarations for the quarter.
3. Pay any interest under section 398(3) and any fee under section 427 before filing.
4. Prepare the file with the RPU, validate it with the FVU, and file it at a TIN-FC or on the e-filing portal by 31 July, 31 October, 31 January or 31 May.
5. Check the processing intimation, and correct within two years if needed.

The next guide, TDS Certificates: Form 16 and 16A, covers the certificates generated from these statements.