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TDS Return Filing 2026: Q1 Due on July 31, Check New Forms and Selection Codes
Written by Shubham Jain
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Businesses and tax deductors filing Q1 TDS/TCS returns for Tax Year 2026-27 must adopt a new reporting framework following the transition from the Income-tax Act, 1961, to the Income-tax Act, 2025 on April 1, 2026. While the due date remains July 31, 2026, this filing cycle introduces major procedural changes, including updated return forms and revised section codes.
The Income Tax Department has already activated these new quarterly forms on the e-filing portal to ensure compliance. In this blog, we will explain what has changed in TDS return filing 2026.
Key Takeaways
- Using old forms for filing Q1 2026-27 can cause errors as old forms have now been replaced. Form 138 replaces 24Q, Form 140 replaces 26Q, and Form 143 replaces 27EQ.
- The Q1 TDS/TCS return filing deadline for the April-June quarter remains the same at July 31st, 2026.
- Transactions made on or from 1st April, 2026 will fall under the new Income Tax Act 2025. Using old section codes will attract system validation errors.
- Update payroll software, accounting systems, and TDS utilities with the latest section codes and form numbers before filing Q1 returns.
- Incorrect section mapping or challan mismatches will lead to defective return notices, delays in processing, and withheld TDS credits.
What Has Changed for Q1 TDS/TCS Filing?
The replacement of the existing quarterly return forms is the major change introduced in Q1 TDS/TCS return filing. Under this new framework:
- Form 138 replaces Form 24Q for TDS deducted from salary
- Form 140 replaces Form 26Q for TDS on non-salary payments
- Form 143 replaces Form 27EQ for tax collected at source (TCS)
Your TDS obligations are determined by the date of credit or payment, and the deadline to file these Q1 statements is the 31st of July 2026 for the April-June quarter. Transactions occurring on or after April 1, 2026, fall under the jurisdiction of the new Income-tax Act, 2025, whereas all earlier transactions remain regulated under the previous Income-tax Act, 1961.
Use Revised Section Codes
Deductors must report transactions by using the revised section codes specified under the new law. Also, the Income Tax Department has warned that applying old section numbers to transactions governed by the new Act could trigger system validation errors when submitting quarterly statements.
What Should Deductors Do Before Filing?
Before filing Q1 returns under the new Income-tax Act, 2025, businesses must update their payroll software, accounting systems, and TDS utilities with the latest section codes and form numbers.
Deductors are required to use the latest Return Preparation Utility (RPU), generate a validated file, and upload it via the e-filing portal using their TAN credentials. Essential preparation includes reconciling tax deducted or collected with challan payments, and carefully allocating single challans across multiple sections to prevent system mismatches.
Since this is the initial transition year, it is important to ensure precise reporting. Errors in section mapping or challan reconciliation will trigger defective return notices, processing delays, and withheld TDS credits.
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To Conclude
The transition to the Income Tax Act 2025 marks an important shift in how TDS and TCS returns are filed. Businesses and deductors must act quickly and be aware of the new forms, revised section codes, and updated utilities to avoid costly errors. Ensuring accuracy in reporting is very important as it is the first transition year.
Confused and need expert help to understand these changes? Contact Savetaxs today. We have a team of experts who can ensure you file your TDS/TCS returns accurately and on time. Our team will ensure that you remain fully compliant with the new framework to avoid any potential issues. Connect with us right away, as we are actively working 24/7 across all time zones.
Glossary
- Income Tax: Income Tax, a Type of Direct Tax, is Imposed by the Government on the Income of Individuals or Organisations.
- Income Tax Act: Income Tax Act, an Act to Manage and Govern the Direct Taxes, by Levying, Collecting, and Administering.
- Income Tax Department: Income Tax Department, a Part of the Indian Government, Handles the Levying and Collection of the Tax.
- Income Tax Return: Income Tax Return, Filed by Taxpayers, Contains a Formal Record of the Collected Tax by the Government.
- Tax Deducted at Source (TDS): The Full form of TDS is Tax Deducted at Source, which is a way to collect the income tax.
- Tax Collected at Source (TCS): The TCS is a tax that is paid by the seller who collects on a sale from the buyer.
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Disclaimer
Note: This guide is for information purposes only. The views expressed in this guide are personal and do not constitute the views of Savetaxs. Savetaxs or the author will not be responsible for any direct or indirect loss incurred by the reader for taking any decision based on the information or the contents. It is advisable to consult either a CA, CS, CPA or a professional tax expert from the Savetaxs team, as they are familiar with the current regulations and help you make accurate decisions and maintain accuracy throughout the whole process.
About Author
Shubham Jain is the Founder of SaveTaxs and has extensive experience in Indian and NRI taxation. He advises individuals, NRIs, and businesses on tax filing, tax planning, capital gains, DTAA benefits, fund repatriation, and compliance matters. He regularly writes about taxation and related financial topics. His focus is on making complex tax concepts easy to understand. Through his articles, he helps taxpayers stay informed, avoid common mistakes, and stay compliant with Indian tax laws. See Full Bio
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Frequently Asked Questions
The due date for TDS deducted in April-June 2026 (Q1) is the 31st of July 2026.
Yes, Q1 TDS returns (salary and non-salary) are generally due by the 31st of July, regardless of the type of deductor, such as a company, firm, individual, etc., unless a specific exemption applies.
Yes, the compliance regime now uses TDS/TCS return forms from April 2026, which replace the old 24Q, 26Q, and 27EQ series.
The legal framework is being restructured. Although many rates and thresholds remain similar, the payment/section codes used in e-payment/TRACES are being refreshed or remapped. Hence, deductors must use the updated codes.
You must refer to the latest official instructions on the income tax e-filing portal/TRACES and any updated circulars on notifications that list old-to-new code mapping.