Income Tax

ITD advisory on new time limit of 2 years for filing TDS/TCS correction returns

Income Tax Department had issued an advisory on new time limit for filing TDS/TCS correction returns as per Income Tax Act 2025 which reduced time limit to two years from six years.

The Finance Act (No. 2), 2024, has amended Section 200(3) and Section 206C(3B) of the Income-tax Act, 1961 (Act of 1961) to put a limit on time limit for submission of TDS/Correction Statements. As per amended provisions of Act of 1961 correction statements can be filed within six years from the end of the financial year in which the original statement was submitted.

However, the Income Tax Act 1961 stands repealed w.e.f. 01.04.2026 by virtue of section 536 of Income Tax Act 2025.

Further, as per section 397(3)(f) of Income Tax Act, 2025, deductor/collector may deliver a correction statement within a period of only two years from the end of the tax year in which such statement is required to be delivered.

Consequent to the above, correction statements for FY 2018-19 (Qtr. 4), FY 2019-20 to 2022-23 (Qtr. 1 to Qtr. 4) and FY 2023-24 (Qtr. 1 to Qtr. 3) shall be accepted only up-to 31st March 2026.

The TDS/TCS correction statements for the above said period shall get time barred by limitation on 31.03.2026 and would not be accepted from 01.04.2026 onwards.

Deductors /Collectors and other Stakeholders may kindly take note of the same and they are advised to take necessary steps to ensure all corrections for the above period, if any, are carried out in time as filing of the same for above period would be barred by limitation on 31.03.2026.

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